Credit cards can come in very handy at times. When you are having trouble with your bills, the temptation to pay the bills with your credit cards can become overwhelming. This is especially true when you have companies threatening to cut off your television, heat, water or electricity. However, paying off your bills with credit cards is a path that you don’t want to go down. The reason is that it can lead you to going deeper into debt than you had wanted to.
Here is an example:
If you owe $200 on your telephone bill and the company has stated they will cut you off if you don’t pay, then you may want to use your credit card. So, you pay off the bill with the credit card, thereby putting a $200 charge onto your credit card. Everything may seem good now, but it is not.The reason is that you have forgotten about the interest, and the interest is always a killer. If you have a 15 percent interest rate on your credit card, then after one month you are going to owe $230 on your credit card. Since you were not able to pay the original $200 on your phone bill, there is the chance you may not be able to pay the $230 on your credit card. As a result, a second month’s interest charge means you now owe $264.50. By using your credit card and missing one month’s payment, you now owe an extra $64.50. Miss another payment and you owe nearly half of what you originally borrowed.
You should never borrow money off of your credit card to pay a bill, and more importantly, you should never try and get a cash advance off of your credit card so that you can pay off your bills. Cash advances come with incredibly high interest and fees. You can often pay 25 to 30 percent interest, plus fees associated with using the cash advance.
A much better option that is available to you, other than paying for your bills with credit cards and cash advances, is to use the minimum payment system. Minimum payments are what you are required to pay to keep your bill from showing up as past due on your credit report. When you make the effort to pay with minimum payments, you are paying off that little bit, but you are still owing a lot of money. Therefore, it is important to use minimum payments, but you should not rely on them. If you only pay minimum payments on your credit cards, you are only paying off the interest. If you keep using your credit card while paying minimum payments, then you are simply causing yourself to fall farther and farther behind.
If you find you cannot afford to pay your bills, it may be time to scale back. By scaling back on your bills, you can save money and not have to worry so much about being late on your payments. You won’t have to use your credit card to pay bills and you won’t have to worry about collection action. This is by far the best option for you and your bills.
If you or anyone else you know would need more information on this post, feel free to visit http://www.creditrepairbydrjen.com
Tuesday, January 27, 2009
Thursday, January 22, 2009
Why should you avoid payday loans and cash advances?
Credit can be a dicey situation when you don’t know how to manage it properly. There are so many fees, interest payments, and more. It can become overwhelming and sometimes you will worry that you will fall behind. Two things you should do to keep from falling greatly behind with your credit and debt, is to take out a pay day loan or use cash advances.
Cash advances are when you take money out of your credit card at the debit machine. This gives you cold hard cash from your credit card and it can seem very appealing to do. However, the truth is that it is one of the worst ways to use money on your credit card. Cash advances have interest rates of as much as 25 percent to 40 percent. That means if you take our $200 in a cash advance, you end up paying between $50 and $80 extra in interest as a result. You should avoid cash advances at all costs. Paying that much interest will only set you back. On top of the interest rates, you can pay as much as $10 to $20 in fees for using the cash advance. Try and use online banking transfers instead of cash advances. Under no circumstances should you use cash advances on your credit card.
Pay day loans seem tempting. If you don’t have the money to pay your bill, you just write a post dated check to a pay day loan company and they give you the money you need at that time. After two weeks, the company cashes the post dated check and everything is square. Sadly, it is not that easy. Pay day loan companies will often take large amounts of interest on your loan. This interest can be as much as 40 percent per two weeks. On a $200 loan, you end up paying $280. There are also other fees attached to it. If by chance you end up bouncing the check because you still don’t have the money, then you have to pay an NSF charge. On top of that charge, there are charges with the pay day loan company, and your interest rate will increase as well. If it takes you an extra two weeks to pay back that $200, you could still owe more than that in fees and interest payments. This is why pay day loans are one of the worst things you can do. It is also why they are illegal in 12 states and severely regulated in 37 states.
Cash advances and pay day loans seem very tempting to use, but they are like a trap door to debt. The interest payments alone can leave you with your head just above water as you continue to take out loans to pay back other loans. Before you know it, your entire house of cards has fallen and you are struggling more than ever with debt. At this point, your only option may be bankruptcy.
If you or anyone else that you know would need more information on this topic, feel free to visit http://www.creditrepairbydrjen.com
Cash advances are when you take money out of your credit card at the debit machine. This gives you cold hard cash from your credit card and it can seem very appealing to do. However, the truth is that it is one of the worst ways to use money on your credit card. Cash advances have interest rates of as much as 25 percent to 40 percent. That means if you take our $200 in a cash advance, you end up paying between $50 and $80 extra in interest as a result. You should avoid cash advances at all costs. Paying that much interest will only set you back. On top of the interest rates, you can pay as much as $10 to $20 in fees for using the cash advance. Try and use online banking transfers instead of cash advances. Under no circumstances should you use cash advances on your credit card.
Pay day loans seem tempting. If you don’t have the money to pay your bill, you just write a post dated check to a pay day loan company and they give you the money you need at that time. After two weeks, the company cashes the post dated check and everything is square. Sadly, it is not that easy. Pay day loan companies will often take large amounts of interest on your loan. This interest can be as much as 40 percent per two weeks. On a $200 loan, you end up paying $280. There are also other fees attached to it. If by chance you end up bouncing the check because you still don’t have the money, then you have to pay an NSF charge. On top of that charge, there are charges with the pay day loan company, and your interest rate will increase as well. If it takes you an extra two weeks to pay back that $200, you could still owe more than that in fees and interest payments. This is why pay day loans are one of the worst things you can do. It is also why they are illegal in 12 states and severely regulated in 37 states.
Cash advances and pay day loans seem very tempting to use, but they are like a trap door to debt. The interest payments alone can leave you with your head just above water as you continue to take out loans to pay back other loans. Before you know it, your entire house of cards has fallen and you are struggling more than ever with debt. At this point, your only option may be bankruptcy.
If you or anyone else that you know would need more information on this topic, feel free to visit http://www.creditrepairbydrjen.com
Monday, January 19, 2009
What are debt collectors forbidden to do?
One of the worst things about being in debt and having a low credit score is the fact that you have to deal with debt collectors. The sad part of this is that many people do not realize just what debt collectors can and cannot do. By knowing what they can do, and are legally allowed to do under the Fair Credit Reporting Act, will help you stay a step ahead of them and not to fall into their traps.
First, debt collectors cannot threaten you to do something that they are not allowed to do. They cannot threaten violence or any crime of any type. They cannot threaten to take your property or your wages without a court order either. Second, debt collectors cannot swear at you, lie about who they are, lie about why they are calling you or contact you so often that it can be deemed harassment. They cannot call you at work either if you have asked them not to contact you at work. As well, it is illegal for a debt collector to call you before 8 a.m., or after 9 p.m.Third, in no way are debt collectors allowed to tell anyone else about your debt. They can only do so if they have a court order against you. This means that debt collectors cannot tell your employer about the debt, but they can call your employer to ask where to find you. Debt collectors cannot contact family members, except for your spouse if you are married, or your parent or guardian if you are under the age of 18.Fourth, a debt collector cannot trick you in order to collect on the debt. This means that they cannot lie about the legal status of the debt, and they cannot claim that they work for a federal or state government agency. They cannot use any paperwork that may make it look like they work for a government agency either.
Lastly, debt collectors cannot add a fee to the amount of the debt unless it is a special case. Also, if you have a lawyer, then the debt collector can only contact the lawyer if you have sent a statement asking them to contact the lawyer on your account.Debt collectors will try anything and everything to get you to pay back your loan or debts. However, sometimes they go a bit too far and begin to cross the line. When they do this, you need to be ready to act because by acting and not falling for their tricks, you can actually help your situation and even have the debt erased due to a threat of a lawsuit on your part. Knowledge is power and knowledge about your rights with debt collectors is very, very powerful, so know your rights. This is why it is important to keep records of when you receive calls from debt collectors, what they say to you and more. Anything that can be used to help your case will help you in the long run and get the debt collectors off of your back.
If you or anyone that you know would like more information regarding this post, feel free to visit http://www.creditrepairbydrjen.com
First, debt collectors cannot threaten you to do something that they are not allowed to do. They cannot threaten violence or any crime of any type. They cannot threaten to take your property or your wages without a court order either. Second, debt collectors cannot swear at you, lie about who they are, lie about why they are calling you or contact you so often that it can be deemed harassment. They cannot call you at work either if you have asked them not to contact you at work. As well, it is illegal for a debt collector to call you before 8 a.m., or after 9 p.m.Third, in no way are debt collectors allowed to tell anyone else about your debt. They can only do so if they have a court order against you. This means that debt collectors cannot tell your employer about the debt, but they can call your employer to ask where to find you. Debt collectors cannot contact family members, except for your spouse if you are married, or your parent or guardian if you are under the age of 18.Fourth, a debt collector cannot trick you in order to collect on the debt. This means that they cannot lie about the legal status of the debt, and they cannot claim that they work for a federal or state government agency. They cannot use any paperwork that may make it look like they work for a government agency either.
Lastly, debt collectors cannot add a fee to the amount of the debt unless it is a special case. Also, if you have a lawyer, then the debt collector can only contact the lawyer if you have sent a statement asking them to contact the lawyer on your account.Debt collectors will try anything and everything to get you to pay back your loan or debts. However, sometimes they go a bit too far and begin to cross the line. When they do this, you need to be ready to act because by acting and not falling for their tricks, you can actually help your situation and even have the debt erased due to a threat of a lawsuit on your part. Knowledge is power and knowledge about your rights with debt collectors is very, very powerful, so know your rights. This is why it is important to keep records of when you receive calls from debt collectors, what they say to you and more. Anything that can be used to help your case will help you in the long run and get the debt collectors off of your back.
If you or anyone that you know would like more information regarding this post, feel free to visit http://www.creditrepairbydrjen.com
Thursday, January 15, 2009
What do you know about your free credit report?
One of the most important tools that you have at your disposal to protect your credit, and repair it, is your credit report. Your credit report is very important because it lists everything about your credit, what needs to be repaired, what needs to be fixed and what your credit score is. How do you expect to repair your credit score if you don’t even know what your score is? Knowing your score will tell you how much you have to repair your credit score by, and where to start. If you have a credit score of 750, then you will know that you probably don’t have to do too much credit repair. However, if your credit score is 500, you know you have your work cut out for you.On top of that, by seeing your credit report, you will be able to see if there is any problems on it, as in credit errors.
Credit errors affect roughly 75 percent of all credit reports. Credit experts state that one of the easiest ways to repair your credit report is to fix the errors that are not your fault. One credit error that is repaired can raise your credit score by as much as 50 points. When you are talking about interest rates and your ability to get credit, 50 points means a lot.You can get your credit report from the three major credit reporting agencies, with TransUnion being the best and most respected of the bunch. A credit report would typically cost you about $40 to obtain, but thanks to the Fair Credit Reporting Act, you have a trick up your sleeve. It is your own free credit report that you are entitled to every single year.
With the Fair Credit Reporting Act, you get a free credit report that you can use to repair your credit and find credit errors. The free credit report can come from any of the credit reporting agencies, and you can go to them directly if you wish. However, there are many websites that offer you the ability to get your free credit report through them. MyFreeCreditReport.com is one such site, but there are many more. However, you should be careful what websites you go to because some websites will be fronts for identity theft schemes. You put in your personal information, and they use it to steal your identity. Try and use well-known websites, or use the website of TransUnion to get the free credit report that you are entitled to under the Fair Credit Reporting Act.Your free credit report is the most important tool at your disposal for repairing your credit report. While you do get a free credit report each year, you should not limit yourself to only one credit report. Every six months is a good timeline to get your credit report. You will get one for free, and pay for one, but it will keep you knowing what your credit is like and it will keep you from becoming a victim of identity theft.
If you or anyone else you know would like more information regarding this post, feel free to visit http://www.creditrepairbydrjen.com
Credit errors affect roughly 75 percent of all credit reports. Credit experts state that one of the easiest ways to repair your credit report is to fix the errors that are not your fault. One credit error that is repaired can raise your credit score by as much as 50 points. When you are talking about interest rates and your ability to get credit, 50 points means a lot.You can get your credit report from the three major credit reporting agencies, with TransUnion being the best and most respected of the bunch. A credit report would typically cost you about $40 to obtain, but thanks to the Fair Credit Reporting Act, you have a trick up your sleeve. It is your own free credit report that you are entitled to every single year.
With the Fair Credit Reporting Act, you get a free credit report that you can use to repair your credit and find credit errors. The free credit report can come from any of the credit reporting agencies, and you can go to them directly if you wish. However, there are many websites that offer you the ability to get your free credit report through them. MyFreeCreditReport.com is one such site, but there are many more. However, you should be careful what websites you go to because some websites will be fronts for identity theft schemes. You put in your personal information, and they use it to steal your identity. Try and use well-known websites, or use the website of TransUnion to get the free credit report that you are entitled to under the Fair Credit Reporting Act.Your free credit report is the most important tool at your disposal for repairing your credit report. While you do get a free credit report each year, you should not limit yourself to only one credit report. Every six months is a good timeline to get your credit report. You will get one for free, and pay for one, but it will keep you knowing what your credit is like and it will keep you from becoming a victim of identity theft.
If you or anyone else you know would like more information regarding this post, feel free to visit http://www.creditrepairbydrjen.com
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