Credit Card Minimum Payments to Increase Soon
November 6, 2009
The Office of the Controller has strongly recommended that credit card companies make their customers pay higher minimum payments, up to double the current amount to try to help us get out of debt. So instead of approximately 2% of your balance, you could pay up to 4%. This will affect at least 7% who currently only pay the minimum and those who can only afford to pay a small portion over the minimum.
These days the average consumer has 4-6 credit cards, not including gas cards, and $8-20 thousand dollars in credit card debt and rising. Paying only the current minimum and never charging again will keep you in debt for 30-60 years, depending on interest, late fees and over limit costs.
The guidelines to raise the credit card minimum were made in 2003, but the banks and credit card companies wanted some time to ease into it. Some say, they waited until the new bankruptcy laws were into effect, so they would have less to lose.
There’s no set date when your credit card company will start increasing your minimum payments, just know they will and probably soon. Some already have. I’ve read dates from July to October of this year and many thought it was going to happen last year, so be warned.
What can you do, if you will not be able to afford this increase?
You can contact your credit card companies and see if any will work out a lower payment for you on a temporary basis. Keep in mind that frequently, when you have payment arrangements like this, they will not let you use your credit card, so keep at least one available for emergencies.
You can hire a debt consolidation company to get a personal loan for you and pay off all your credit cards. Personal loans usually don’t have very low interest rates, like a home equity loan or refinancing your home. If you don’t think it will take you too long to pay off or you don’t own a home, this may be the way to go. You can also hire these people to make payment arrangements for you or charge off some of your debt. Be careful here, any debt they get “charged off” for you will show that way on your credit report, lowering your credit score dramatically, and you will have to pay taxes on the charged off amount as income.
One solution, is to either get a home equity line of credit or refinance your home. The interest rates are lower than a personal loan or credit card and spread out farther, so you will pay a much lower monthly payment. You always have the option of paying more than the minimum when you can afford to.
If your debts aren’t too terrible, but you may need more in the future for home repairs, my suggestion would be to go with the home equity line of credit. Get approved for a little more than your debts and expected home repairs, so you won’t have to worry about getting another one for a while. Try to pay more than the minimum whenever you can without risking your cash flow.
If you have a lot of credit card debt, home repairs that need to be made, an unstable job or other situation that could make matters much worse at any time, you should probably consider refinancing. If it’s been at least a year or more since you purchased or previously refinanced your home you probably have enough equity, depending on where you live of course. Also, if you’ve been making your payments on time for the past year or more, you’ll have a good payment history and should have a good enough credit score to get a decent rate.
If you have late payments, you still may want to consider refinancing at a higher rate, as a temporary solution. Your interest rate will probably be much less than your credit card interest, so you’ll pay a lower monthly payment and not risk ruining your credit or worse, losing your house. If you pay all your bills on time for the following 11/2 to 2 years, you can refinance again to get a better rate.
If you think that the rise in credit card minimum payments will affect you adversely, try to make a decision on what you are going to do about it soon. The longer you put it off, the harder it will be to deal with in the future.
Sandra Wellman is a mortgage specialist who can help you refinance your home or get an equity line of credit to help you pay off those credit cards. You can contact her at 510-713-7800 ext 135.
Low Interest Rate Mortgages Do They Exist
November 5, 2009
Whether you want to obtain a credit card, loan, or mortgage, you will have to deal with interest rates. Unfortunately, interest rates can turn something that would otherwise be affordable into something that no longer is. To combat this problem, you are encouraged to search for low interest rates.
Obtaining a low interest rate, especially with a mortgage, is often easier said than done. As a potential homeowner, you have little control over the rate which you are being offered. This is why many individuals believe that low rate mortgages do not exist. Despite that belief, it is still possible to obtain a low interest rate mortgage.
If you are interested in obtaining a low interest rate mortgage, you will need to be prepared to do a little bit of research. You will have to find lenders that specialize in low interest rate mortgages. They are out there, but it may take a little bit of time to find them. In addition to finding low rate lenders, you may also want to examine and possibly improve your credit.
If you are wondering what your credit has to do with obtaining a low interest rate mortgage, you are not alone. Many believe that the interest rate is solely decided by the lender that they are seeking to obtain a mortgage from. While it is true that your financial lender will have the deciding say in what your interest rate will be, your credit can have an impact as well.
Mortgage lenders often have a preset interest range that they are allowed to charge. This preset range is often implemented by the government to keep the cost of owning a home affordable. Mortgage lenders, like all other financial lenders, are a little bit leery of doing business with an individual that has a low credit rating. To offer themselves security, they tend to charge those with poor credit a higher rate. This is not always the case, but a large number of lenders operate this way.
The good news about your credit is that you can improve it. If you know that you would like to buy a home in the future, you are encouraged to examine your credit. If you find anything that is unpaid, you are encouraged to pay it as soon as possible. In addition to having an impact on your interest rate, an improved credit score may even increase the amount of money that you are able to have to purchase a home.
Since interest rates vary and depend on a number of factors, you may want to do a little bit of comparison. The interest rate being advertised may not necessarily be the one that you will be offered. To receive an exact rate, you may be required to provide a mortgage lender with a little bit of information. Once they take your credit, your current financial situation, and the amount of money you are requesting into consideration they should be able to determine what the interest rate of your mortgage will be.
Once you have examined the rates from a number of mortgage lenders, you can easily compare your findings. If you are seeking a low interest rate mortgage, you will want to go with the lender who is offering you the lowest interest rate. It may take a little bit of time to compile all of this information together, but the amount of money you save on interest may be worth it in the end.
Joe Kenny writes for the Credit Card Guide, offering views on credit cards in the UK, visit them today for some great 0% balance transfer offers and start clearing credit card debt today.
Foreclosed HomeDiscover The Truth About Foreclosed Homes
November 5, 2009
Foreclosed houses are houses that have been closed by an individual or a group of individuals before another person owns them. Such situations arise when mortgagers either dont bother to take their house back or are unable to release it because of financial adversities. As a result mortgaging companies takes over the charge of the house and offers to resale it.
You might have come across property news and newspaper advertisements, local magazines or even the Internet having information about foreclosed homes. Even the real estate agents have foreclosed homes offers in plenty. To know more about foreclosed homes you can talk to the real estate agents or even the assessors. Plan a visit to the local courthouse would give you a rough idea about the various deals and how their dealing process. Similarly, you can also attend the foreclosure home auctions to know more about the auction options and the risks involved.
Planning to buy a foreclosed home is one of the most significant financial decisions an individual has to take. Purchasing foreclosed homes includes bargaining the foreclosed sale, acquiring mortgage, getting the title insurance and finishing the home purchase.
Before buying a foreclosed house you should be well informed about the various options available. This applies especially to the first time foreclosed homebuyers who are new to the foreclosed property transactions. As mentioned before, consult a reputable title agent or attorney before buying a home.
Many people harbor wrong notions that foreclosed homes are basically shabby homes in rundown neighborhoods. However, its only people who are actually investing in foreclosed properties that know that this notion is incorrect. Foreclosed homes come in a variety of size and shapes, consisting of large, beautiful new homes in the most sought after neighborhoods.
You are in for a terrific amount of savings, if you are buying a foreclosed house. Strange as it sounds, this is true. By buying homes at 10% to 60% below the original market value simplifies making monthly payments and generates huge savings on the whole. In some circumstances, individuals can buy homes with very less or no deposits, even if they have a bad credit history. Foreclosure pricing is also known for building equity instantly.
Today, you might find more opportunities for buying foreclosures than ever before. To some extent this is because of the high debt rates getting more people into financial trouble, and partially because lenders are giving mortgages to higher-risk borrowers. However, the good news is that together these factors are increasing loan default rates. People who plan to buy foreclosed homes can pick and choose the home they want at a great price. Many of these homes are not advertised, as they are not profitable for the real estate agents.
Foreclosed homes can prove to be of good value for the right person who is willing to consider all the options available. If you are a buyer of foreclosed homes, keep in mind that these houses are not necessarily vacant. Till mortgage companies hand over the house to the buyer, the original residents still own it. Basically, it depends on the buyer decision to keep the original owners as tenants or ask them to vacate the house. Furthermore, furnishing or renovation of the house is not the responsibility of the original buyers.
Sell Your Home Fast? As Is Now will buy your house in 24 hours if approved and you get cash in your pocket. We help you get rid of your home fast for any reason including to Stop Home Foreclosures : http://www.asisnow.com/main.php.
Surging Inflation Impacts Upon Consumer Finances
November 4, 2009
Earlier this week the publication of a new study suggested that the British public is experiencing much greater financial pressure than the government figures indicate.
According to statistics released by the Motley Fool, some nine out of ten consumers believe that the cost of living is rising by 7.3 per cent - about three times higher than the official number of 2.5 per cent. Overall, two out of three believe their personal inflation lies between four and nine per cent, with one in five people claiming is stands between ten and 15 per cent.
Meanwhile, those in Scotland suggested that inflation currently stands at 6.3 per cent - a fall from the 7.5 per cent noted in January. On the other hand, Northern Ireland consumers could be facing a particular increase in difficulties with their day-to-day finances as they claim to face an inflation rate of 8.1 per cent - the highest figure noted in the country and up by 0.4 percentage points from six months ago.
David Kuo, head of personal finance for the firm, said: “Older people, especially those who rely on retirement income, are some of the worst affected. Furthermore, people relying on the basic state pension, which will only rise in line with government inflation figures, may feel the pinch even more. Inflation is sometimes called the hidden risk because it quietly chips away at the buying power of the pound in our pockets. But it’s hard to disguise a chip when it becomes a chunk.”
Consequently he suggested that inflation is not “whittling away” consumers’ income as official figures suggest but rather is leading towards a significant rise in debt problems. “For one in five people, the buying power of the pound in their pockets is being eroded at over twice this rate,” Mr Kuo claimed.
Consumers aged 58 and over claimed inflation rates currently stand at 7.1 per cent, which could see these people particularly facing debt problems. Meanwhile, those between 42 and 49-years-old claimed the highest rises in living costs at 7.6 per cent. However, although young people were said to have been the least affected, they claimed living costs had risen to 6.9 per cent a rise of a full percentage point since January.
But, in a challenge to the Motley Fool figures, research from Birmingham Midshires’ Life 2 campaign has indicated that those over the age of 55 see themselves are being financially comfortable. Some 19 per cent of those in the group claim they can afford the social life they want, with one in ten reported to be “totally satisfied” they can afford to indulge themselves.
However, only one in 50 of 18 to 24-year-olds were said to hold this level of satisfaction. The study from the financial services firm also indicated that just over half (55 per cent) of consumers aged above 55 with both a state and personal pension account say that they are confident that they can afford day-to-day expenses in later life, the largest proportion recorded among any working group. Meanwhile, this figure was said to have fallen to 15 per cent for Britons with just a state pension.
Jason Robinson, director of savings operations for Birmingham Midshires said: “The over - 55s are facing enormous change in their lives and many may be apprehensive about their retirement.”The director added: “It’s great news that many people can look forward to financial and social freedom in later life - but, of course, the more money they have coming in from pensions and savings the more enjoyable retirement will be.”
However, with inflation rates higher than officials figures and the government announcing yesterday that interest rates are rise to 5.75 per cent consumers of all ages could find their day-to-day finances squeezed.
Abbi Rouse writes for 1 stop finance shop where visitors can apply for UK debt consolidation loans and also focuses on cheap personal loans and bad credit secured loans for UK residents.
How To Get Debt Collectors Off Your Back Permanently
November 4, 2009
Debt collectors are liars, cheaters, etc… They take advantage of every loophole possible and even break the law. They have been featured on almost every news program from CNN to 60 Minutes. There are laws in place to contain their harassment and collection efforts and to make this process more civil, but most figure the risk of getting caught is minimal and that the rewards of endlessly harassing and fleecing victims is far greater. We now have the power to take back our lives, stop them in their tracks and sue them for more than they are trying to collect.
First, lets start with what is actually owed and how most collection agencies work. Usually a unpaid debt is either sold or turned over to a collection agency. 95% or more of these debts are credit cards, store cards, gas cards, etc… These debts are then tiered according to age of debt, amount, credit, job history, etc… Generally most debts are bought for pennies on the dollar. Recent debt may go for $.15 to $.25 on the dollar whereas old debt that has had numerous collection attempts goes for $.05 or less and debt that is beyond the statues of limitations for the state the debtor resides in goes for less than $.01. So, for instance if you owed $10000.00 on a credit card, the debt collection agency paid at most $2500.00, but probably paid less than $1500 for it. Now, what’s interesting is that they will call and write you stating that you now owe $14000.00 or so stating that it has accrued interest and various questionable fees. This is all profit if you were dumb enough to pay that. A fair settlement would be $1700.00 or less. So, the point here is that you don’t ever owe what they are trying to collect from you - it is always far, far less.
Secondly, lets give you some more ammunition - The 1977 FDCPA (Fair Debt Collection Practices Act) gives you rights the debt collectors won’t tell you about. If you don’t want to hear from them again, its easy. Just write them a letter stating that you wish they cease all contact with you (make sure you put in the letter that - P.S. This letter is in no way an acknowledgement of the above listed debt(s) - that way they cannot even attempt to try and re-age your debt (add another 7years of collection and reporting to further harass). Send the letter registered return receipt requested mail and keep your proof of receipt. If they contact you after this for any reason other than to tell you they are either dropping the issue or taking it to court (99.99% won’t go to court as it costs them more money and their odds of getting anything are almost zero - even with a judgement) then you can sue them for each occurrence for $1,000. People win these suits every day - most settle out of court for a lot more than the original debt (just look this up on the internet under small claims court). You also have the right to question the debt and have the debt collector provide proof. Many debt collection agencies are being sued by many debtors for their failure to provide proof. Just look up Asset Acceptance on the internet - they are one of the biggest abusers of this federal law with thousands of outstanding lawsuits for harassing debt collection practices.
So, now you know how to stop debt collection agencies in their tracks. You know how to get relief - sue them! If enough people sue them things will change. Also use your state and local resources. State Attorney generals go after debt collection agencies that routinely break the law, Consumer protection agencies (the Better Business Bureau, etc…), the Federal Trade Commission goes after the worst abusers, and, of course, your state department of insurance and finance (whom actually licenses these agencies rto operate in your state). You state department of finance and insurance, or similar, has the power to fine, punish and even banish the debt collection agency from your state. Every state requires a debt collection agency to be licensed and put up a large financial bond (around $50,000) to operate in your state. Call these folks if you are having problems with a debt collection agency - they will get immediate results in your favor. Don’t threaten the collection agency that you have these rights - use them. Bring the collection agency to its knees if they are violating your rights.
The other problem is are these bills, debts even correct? Many hospitals, doctors, etc… have no ethics and will purposely double or even triple bill patients without insurance because they know they can get away with it. If you have a question about your bill demand a itemized bill and have this professionally examined. This will reveal things like overcharging ($100 tissue boxes, 1000 percent markup on medicines, etc…) We entrust these hospitals and doctors with our lives and then they screw us by double billing or worse. Right now there is no government policing on hospitals. Many times a debt collector will actually make up a debt or illegally pass one on to you from someone else (Asset Acceptance has been sued for this many times). Do not assume that you owe any debt and take them to task. If you do owe it, pay it, but pay the least amount possible, and pay it on your terms. If they break the law - make them pay!
If you have a problem with a bill make it known to your state politicians. If enough people do this things will change. Write to your local newspaper, tell a friend, do a press release. Tell others of their rights. Cigarette boxes come with warnings - shouldn’t debt collectors and debt collection agencies with their high propensity to skirt the law also come with mandatory warnings? The more the word gets out, the better the odds something will be done about it.
David Maillie holds numerous patents including his recently awarded patent for headlight repair, cleaner and restorer. He can be reached at M.D. Wholesale: MDwholesale.com Bestskinpeel.com
5 Ways to Find the Best Stock Picks
November 3, 2009
There is no doubt that penny stocks are a risky and thinly traded breed of stocks issued by relatively tiny companies. Also, the SEC does not require penny stocks to follow their reporting rules. This combined with unclear or unverifiable financials can make this stock seem like something to avoid altogether. Penny stocks can be dangerous for investors of all experience levels but especially for amateurs just getting their feet wet. Here are five tips to help find the best penny stock picks.
1. Profit
First off is the company you are interested in investing in experiencing any sizeable profits. Better yet is their profit to debt ration favorable. Youd be hard pressed to find one of these little companies without debt but that doesnt mean you cant be picky. In this case the least amount of debt with the most profit will be a better investment. Another thing to watch is how progressive the debt payoffs have been. This would be a sign of good or bad financial management.
2. Industry Trends
This is one of those methods that almost all people use anyway. If there is a high demand for oil then people instinctively want to go buy oil stocks. The only problem with this kind of trend analysis is it really isnt forward looking analysis. This is just waiting and seeing which doesnt get you in on the ground floor of and investment before the public takes notice. Investing ahead of an industry trend is far better. So look for stocks in industries that are the edge of more demand.
3. Personal Interest
Theres a saying that you do well at things you enjoy to do. This makes logical sense and it works with stocks as well. If you invest in something that actually interests you then you will naturally be more studious and make more of an effort to choose the best stocks. It can be very boring researching stocks that dont interest you and you are likely not to be as thorough as you should be.
4. Tenure
How long has the company been in business? This is not to say that investing in newer companies is a bad idea but its more likely to be safer investing in a more established company with some kind of track record.
5. Bad Behavior
Last tip is an obvious one. Stay away from companies whose operations or transactions have been questionable. Even if the bad press is not completely true it will be difficult for a company to recover in the short and maybe even long term.
Scott Johns conducts research and analysis of stock market picks for a penny stock analysis company. To check out penny shares for some of his company’s latest picks.
Is Student Loan Consolidation Good
November 3, 2009
Consolidating your student loan(s) is one of the smartest things that you can do. You should consider a student consolidation loan if you have several federal student loans or even just one large one.
Student consolidation loans will have fixed interest rates which are similar to those of the loans that are being consolidated. The amount that you can save through consolidation can be up to 58%.
Federal Stafford loans, Federal Direct Loans, Federal Perkins Loans as well as many others can be consolidated. Most of the time, they already have low rates.
Advantages
- You will have a single loan payment which is often lower than what you currently pay.
- It is easy to set up.
- It will help lower your debt burden.
- You can secure the lowest interest rate at the time.
- It can help you qualify for new or renewed deferments.
What To Consider
When you consolidate, make sure that the interest rate that you are offered is lower than your current rate. You want to pay off your student debt easier and maybe quicker too.
While consolidation can simplify the loan repayment process and lower your monthly payment, in the long run it usually increases the total amount that you will have to pay.
Student loan consolidation provides lower monthly payments by allowing you to spread the loan over 30 years in some cases. You are paying more payments, so be sure to compare the total cost of repaying your unconsolidated loans with the cost of repaying them through the consolidation loan.
The process of consolidating is very flexible. Consolidation is available from before you graduate down through years of repayment.
First, you need to gather information about your current loan. You need to know the balances and the interest rates, the names and addresses of companies and the names and addresses of personal references. The National Student Loan Data System can help provide you with the information that you need since it holds the most complete and accurate information for federal loans.
Paying Them Back
You will have 2 options to pay these loans back.
1. Pay a standard amount each month. This will include principle and interest. This is the lowest cost of interest paid way to go.
2. Or a graduated repayment. Here you start with lower payments that are only interest, but then they will keep increasing.
Usually repayment of your consolidation loans will begin in 60 days and will take from 10 to 30 years to fully pay back.
There are some questions that you should ask the lender before going forward.
- is there a rate reduction, for example for making your payments online or on time?
- does the loan meet your specific needs?
- is that the best interest rate available?
To get a student loan consolidation, you can still be enrolled in school or graduated. Either way, you’ll find many lending options that will fit your needs.
Visit Consolidate loan for more. Ron King is a researcher, writer, and web developer, visit Articles for authors. Copyright 2006 Ron King.
Which Charity Credit Cards Are Worthy Of Your Support
November 2, 2009
Donating to good causes is a great way to help people who are less fortunate. People have always been able to help good causes by giving up their time or handing over cash. Now the process is even easier.
Many charities now have branded credit cards that enable consumers to donate to the charity every time they spend. These charity credit cards are backed by major UK banks. The Royal Bank of Scotland, Halifax and the Cooperative Bank all support several charity credit cards.
Learning About Charity Credit Cards
When consumers first sign up for a charity credit card, the issuing bank makes a donation to the relevant charity. This sum ranges from 5 to more than 40. The actual sum donated will depend on the terms of the particular credit card deal. If consumers keep and use the card, then card issuers usually make a second donation at the end of six months or a year.
Charity credit cards also give ongoing support to charities by paying a percentage of any spending on the card to the nominated charity. For example, most cards contribute 0.25% of spending to the charity. This means that 25 pence is donated to charity for every pound spent on the card. Some charity credit cards offer a donation of as much as 1%, so the amount given to charity increases to match. This is worth thinking about when deciding which charity credit card to go for.
What Causes Can I Support With Charity Credit Cards?
There are cards for almost every good cause. These include:
- Cancer charities such as Cancer Research UK and Breakthrough Breast Cancer Trust
- Children’s charities such as the NSPCC, Great Ormond Street Hospital and Barnardos
- Animal charities such as the RSPCA and PDSA
- Aid agencies such as Christian Aid and Oxfam
- And many more.
To find out if the charity you want to support has a credit card, telephone them or visit their websites. There are also several credit card comparison sites to help consumers decided among the different credit card offers.
What Incentives Are There For Using Charity Credit Cards?
Charity credit cards offer the same incentives to new cardholders as other cards. This means that, depending on the offer, cardholders can benefit from:
- Low annual interest rates
- 0% balance transfer rates for a fixed period
- 0% interest on purchases for a fixed period
- other rewards and incentives.
Some credit card issuers may charge a one-off balance transfer fee. This should be considered when deciding on the right card.
As with all credit cards it is essential to make payments regularly and on time to avoid attracting any penalty fees.
Once people have selected the right charity card, making a donation is as simple as doing what they would do anyway. All they have to do is spend money in the usual places and their favourite charities will get the benefit.
Joe Kenny writes for the Credit Card Guide, offering views on credit cards in the UK, visit them today for some great 0% balance transfer offers and start clearing credit card debt today.
Is Student Loan Consolidation Good
November 2, 2009
Consolidating your student loan(s) is one of the smartest things that you can do. You should consider a student consolidation loan if you have several federal student loans or even just one large one.
Student consolidation loans will have fixed interest rates which are similar to those of the loans that are being consolidated. The amount that you can save through consolidation can be up to 58%.
Federal Stafford loans, Federal Direct Loans, Federal Perkins Loans as well as many others can be consolidated. Most of the time, they already have low rates.
Advantages
- You will have a single loan payment which is often lower than what you currently pay.
- It is easy to set up.
- It will help lower your debt burden.
- You can secure the lowest interest rate at the time.
- It can help you qualify for new or renewed deferments.
What To Consider
When you consolidate, make sure that the interest rate that you are offered is lower than your current rate. You want to pay off your student debt easier and maybe quicker too.
While consolidation can simplify the loan repayment process and lower your monthly payment, in the long run it usually increases the total amount that you will have to pay.
Student loan consolidation provides lower monthly payments by allowing you to spread the loan over 30 years in some cases. You are paying more payments, so be sure to compare the total cost of repaying your unconsolidated loans with the cost of repaying them through the consolidation loan.
The process of consolidating is very flexible. Consolidation is available from before you graduate down through years of repayment.
First, you need to gather information about your current loan. You need to know the balances and the interest rates, the names and addresses of companies and the names and addresses of personal references. The National Student Loan Data System can help provide you with the information that you need since it holds the most complete and accurate information for federal loans.
Paying Them Back
You will have 2 options to pay these loans back.
1. Pay a standard amount each month. This will include principle and interest. This is the lowest cost of interest paid way to go.
2. Or a graduated repayment. Here you start with lower payments that are only interest, but then they will keep increasing.
Usually repayment of your consolidation loans will begin in 60 days and will take from 10 to 30 years to fully pay back.
There are some questions that you should ask the lender before going forward.
- is there a rate reduction, for example for making your payments online or on time?
- does the loan meet your specific needs?
- is that the best interest rate available?
To get a student loan consolidation, you can still be enrolled in school or graduated. Either way, you’ll find many lending options that will fit your needs.
Visit Consolidate loan for more. Ron King is a researcher, writer, and web developer, visit Articles for authors. Copyright 2006 Ron King.
How To Get Debt Collectors Off Your Back Permanently
November 2, 2009
Debt collectors are liars, cheaters, etc… They take advantage of every loophole possible and even break the law. They have been featured on almost every news program from CNN to 60 Minutes. There are laws in place to contain their harassment and collection efforts and to make this process more civil, but most figure the risk of getting caught is minimal and that the rewards of endlessly harassing and fleecing victims is far greater. We now have the power to take back our lives, stop them in their tracks and sue them for more than they are trying to collect.
First, lets start with what is actually owed and how most collection agencies work. Usually a unpaid debt is either sold or turned over to a collection agency. 95% or more of these debts are credit cards, store cards, gas cards, etc… These debts are then tiered according to age of debt, amount, credit, job history, etc… Generally most debts are bought for pennies on the dollar. Recent debt may go for $.15 to $.25 on the dollar whereas old debt that has had numerous collection attempts goes for $.05 or less and debt that is beyond the statues of limitations for the state the debtor resides in goes for less than $.01. So, for instance if you owed $10000.00 on a credit card, the debt collection agency paid at most $2500.00, but probably paid less than $1500 for it. Now, what’s interesting is that they will call and write you stating that you now owe $14000.00 or so stating that it has accrued interest and various questionable fees. This is all profit if you were dumb enough to pay that. A fair settlement would be $1700.00 or less. So, the point here is that you don’t ever owe what they are trying to collect from you - it is always far, far less.
Secondly, lets give you some more ammunition - The 1977 FDCPA (Fair Debt Collection Practices Act) gives you rights the debt collectors won’t tell you about. If you don’t want to hear from them again, its easy. Just write them a letter stating that you wish they cease all contact with you (make sure you put in the letter that - P.S. This letter is in no way an acknowledgement of the above listed debt(s) - that way they cannot even attempt to try and re-age your debt (add another 7years of collection and reporting to further harass). Send the letter registered return receipt requested mail and keep your proof of receipt. If they contact you after this for any reason other than to tell you they are either dropping the issue or taking it to court (99.99% won’t go to court as it costs them more money and their odds of getting anything are almost zero - even with a judgement) then you can sue them for each occurrence for $1,000. People win these suits every day - most settle out of court for a lot more than the original debt (just look this up on the internet under small claims court). You also have the right to question the debt and have the debt collector provide proof. Many debt collection agencies are being sued by many debtors for their failure to provide proof. Just look up Asset Acceptance on the internet - they are one of the biggest abusers of this federal law with thousands of outstanding lawsuits for harassing debt collection practices.
So, now you know how to stop debt collection agencies in their tracks. You know how to get relief - sue them! If enough people sue them things will change. Also use your state and local resources. State Attorney generals go after debt collection agencies that routinely break the law, Consumer protection agencies (the Better Business Bureau, etc…), the Federal Trade Commission goes after the worst abusers, and, of course, your state department of insurance and finance (whom actually licenses these agencies rto operate in your state). You state department of finance and insurance, or similar, has the power to fine, punish and even banish the debt collection agency from your state. Every state requires a debt collection agency to be licensed and put up a large financial bond (around $50,000) to operate in your state. Call these folks if you are having problems with a debt collection agency - they will get immediate results in your favor. Don’t threaten the collection agency that you have these rights - use them. Bring the collection agency to its knees if they are violating your rights.
The other problem is are these bills, debts even correct? Many hospitals, doctors, etc… have no ethics and will purposely double or even triple bill patients without insurance because they know they can get away with it. If you have a question about your bill demand a itemized bill and have this professionally examined. This will reveal things like overcharging ($100 tissue boxes, 1000 percent markup on medicines, etc…) We entrust these hospitals and doctors with our lives and then they screw us by double billing or worse. Right now there is no government policing on hospitals. Many times a debt collector will actually make up a debt or illegally pass one on to you from someone else (Asset Acceptance has been sued for this many times). Do not assume that you owe any debt and take them to task. If you do owe it, pay it, but pay the least amount possible, and pay it on your terms. If they break the law - make them pay!
If you have a problem with a bill make it known to your state politicians. If enough people do this things will change. Write to your local newspaper, tell a friend, do a press release. Tell others of their rights. Cigarette boxes come with warnings - shouldn’t debt collectors and debt collection agencies with their high propensity to skirt the law also come with mandatory warnings? The more the word gets out, the better the odds something will be done about it.
David Maillie holds numerous patents including his recently awarded patent for headlight repair, cleaner and restorer. He can be reached at M.D. Wholesale: MDwholesale.com Bestskinpeel.com
