July 26th, 2009 | Posted in Credit Card Debt Settlement
Credit Card Debt Settlement
Unfortunately, I have had a previous experience with a credit card debt settlement company and I have some insights you may be interested in. I would firstly like to take a minute to describe how the credit card debt settlement process works. Please be advised that these companies like to sugar coat everything- so be sure to write down a list of questions, and get a thorough grasp of what you are getting into.
The system requires you to go into default on your unsecured credit card bills (that means you do not pay your bills). The credit card debt settlement company will require you to pay them either a flat fee or a fee determined by a percentage of how much debt you have. You must pay these fees up front, (they do not accept Credit cards, lol) way before they even begin handling your case.
You will make (non refundable) monthly payments ( usually less than you paid monthly for your credit card minimums). The first several payments will be pocketed by the debt settlement company, until they have thier fee collected. Then the payments will be saved up by the debt settlement company on your behalf , for the purpose of collecting larger sums of money, to offer debtors settlements on your accounts.
Remember, througout the entire process you are not paying any of your bills. Creditors will call you and harass you, they will call your place of employment, your family, and anyone else they possibly can and tell everyone you are in default with your payments. Yes this is illegal but they do it anyways, and your credit card debt settlement company will tell you to tell the creditors to call them instead, but they don’t, they continue to call you. Your debt will be sold several times over, each time with a less scrupulous collector. In my experience they threatened me with suing, confiscating things, and down right attacked me and my moral ethics.
As I was going through this process I was told by an outside source that whatever debt I was relieved would considered a gift by the IRS, and thus be counted as income, and I would have to pay taxes on this amount of money as if I earned it at a job ( to the tune of about 40% payback to the government). Please also remember when your not paying your bills, late fees, and interest charges accrue quickly ( My dept wound up tripling).
This is when I decided to see an attorney about bankruptcy procedures. I will have you know that all of the payments beyond my fee to the credit card debt settlement company was non refundable. They would not give me back a penny after I changed my mind.
It is in my opinion that one should contact an attorney for a free consultation before pursuing any debt settlement, counseling, or non profit organizations for debt relief. For $750 I was able to erase all my debt and not have to pay the IRS anything where as I paid a debt settlement company over $2000 and did not get a thing except more in debt.
Debt settling and bankruptcy have the same adverse effects on your credit rating. With either, if you have any credit cards that is not in default, it would be wise to hold on to those accounts throughout proceedings ( do not use them). These cards will help boost your chances of recovering your credit scores in the future.
May 28th, 2009 | Posted in Zero Percent Credit Cards
Zero Interest credit cards offer some financial relief on high interest credit cards. If used wisely Zero percent offers can save the consumer allot of Credit Card money.
Zero interest credit cards are probably the most under-utilized way to get on one’s financial feet. There’s plenty of advice available on using lower interest debt consolidation loans to consolidate credit debt and reduce monthly payments. However, very rarely do we hear the suggestion that we can get away with paying no interest at all unless someone is trying to sell us furniture on a buy now and pay later basis. Yet, special zero rate credit card offers provide a fantastic way to significantly reduce monthly expenditure on credit cards as well as help with debt problems.
You don’t have to be a materialistic, greedy individual to find yourself overspending on credit cards. So many things can go wrong in this high cost society that can increase our credit card debt. Serious illness, emergency repairs and job loss are just a few common situations that can cause our credit card balances to soar. Most of us hope that things will get better and we will be able to catch up later, unfortunately the higher our credit card balances, the higher our monthly payments. This increasing monthly cost can keep us poor and make it difficult for us to ever get back on our feet. The largest part of our monthly credit card payments are interest charges. Therefore, it only makes sense to reduce our interest costs as much as possible and you can’t get lower than zero interest. By simply transferring your credit card balances to one of the many available zero interest credit cards you will be able to save your interest charges for a given, introductory period of time.
There so many introductory credit cards available that it can be difficult to sort through them and choose the best one for your needs. It is important to choose an offer with low balance transfer fees and a long introductory period during which you do not have to pay any interest at all. The easiest way to find zero interest credit cards is to use a professional online credit card service which has already done a lot of the hard work for you by finding the best deals. These sites not only give you a number of cards to choose from, they also offer online applications to make things convenient and easy.
However, to truly make the most of zero interest credit cards, you can keep transferring the balance to new zero rate offers before the end of each introductory period. If you do this, you will never pay interest. Unfortunately, with the best will in the world, life tends to take over and we can easily forget to transfer the balance before interest payments kick in. Some of the more excellent online credit card services also offer a reminder service to let you know when your interest free period is due to expire so that you can apply to transfer your balance to a new interest free credit card offer.
Used in this way, zero interest credit cards can substantially improve your financial position. By taking advantage of professional, online services that also offer an alert to remind you when to transfer your credit card balance again you can take long term advantage of interest free credit card offers. Do this, and you’ll never look back.
