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Debt Management Begins With Paycheck Management

Jul 20

Posted by admin in Bankruptcy, Debt Consolidation, Taxes

This is an exciting time of the year for many American consumers, as tax time approaches. No, most people are not too excited about filing their income tax return, but most people receive a refund each year, and this year that refund averages out to a little more than $2000. That windfall is usually quickly spent on a new TV or a vacation or as a down payment on a new car. Tax refunds are rarely spent wisely, which is a pity.

The average American household carries nearly $10,000 in credit card debt, and that $2000 or so could go a long way towards paying that debt down. Of course, few people will see it that way, as such a large sum of money just seems better suited towards some large purchase. But what if that $2000 was in your pocket all along? Could you have done something smarter with it?

The tax refund that most people receive each year is just that; a refund. It means that the taxpayer paid more money in taxes than he or she owed, and for the average taxpayer, that means about $170 per month. That money has effectively been lent to the government, interest-free, for a year. With most people heavily in debt, who can really afford to lend the government money at no interest for a year? Couldn\’t that money be put to better use year-round?

Of course it can. That money can be used each and every month to reduce debt. If consumers would simply adjust their tax withholdings by filing a new form W-4 with their employers, the amount of taxes taken out of their paychecks could be reduced accordingly. That means, on average, an extra $170 per month, every month in the paycheck. And that money would be available to make extra payments on those monthly credit card bills. It\’s a far cheaper and easier way to reduce debt than to go through some complicated and expensive debt consolidation plan.

The W-4 form allows tax deductions for each dependent child and offers allowances for employees who are married. Each time that status changes, employees should reevaluate their tax payments and fill out a new form accordingly. If you have no idea how much should be withheld from your paycheck, you can go to the Web site of the Internal Revenue Service and try their tax-withholding calculator. There is no reason to lend interest-free money to the IRS when you could be using that money to pay off your bills that are accruing interest at 20%. Use your money wisely.

?Copyright 2006 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including End-Your-Debt.com, a site devoted to debt consolidation, personal bankruptcy, establishing credit and credit counseling and HomeEquityHelp.net, a site devoted to information regarding mortgages and home equity loans.

Writen By : Charles Essmeier

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First Two Steps Towards Credit Repair

Jun 19

Posted by admin in Finance

Having a credit has become a vital instrument in our lives. Good credit score will allow us lots of everyday things we usually take for granted without paying much attention to them. Being eligible for credit will make it possible for you to have a credit card, rent a property, buy or rent a car. Without credit many of these things would be unavailable to you.

Remember that every time you dont make payments to your creditors it will be go on your credit report and will in time drop your credit to a level where it is going to be very, very difficult for you to get a credit.

If something like this happens you must start with your bad credit repair. Bad credit repair can be a very slow and it will require a large amount of your time, effort and patience.

Listed below are a few things that may help you in that:

1) Try to add more accounts to your credit score report. In case that you have been rejected when asking for a credit, get your credit report right away. When you get it examine it thoroughly and look for any possible mistakes.

If you cant find any mistakes it is possible that your credit score is bad not because you have outstanding debts to pay back, but rather because you do not have sufficient credit history to encourage a good credit score.

What can you do if that is the case? Numerous kinds of credit from minor companies arent followed by credit bureaus. For example gas cards and department store cards are often left out from your credit report.

If you can verify your account with any of these, credit bureaus will usually add them to your record. Because they are not compelled by the law to do so, they\’ll in most cases charge you for it. But you will benefit from it by establishing a better credit score.

2) Get a credit counseling. Once your debt becomes unmanageable it can become avalanche that can burry you and youll have a very hard time getting out of it.

If you have constant problems in your credit repair effort, you should think about getting a help from a credit counselor or a credit repair agency.

The difference between the two is that credit counseling service is non-profitable, advice giving service while credit repair
companies work for profit (will charge you for their service), and there has been a lot of problem lately with some credit repair company using unethical techniques.

If you choose to go this way use the well know law firm that specializes in credit repair.

Good credit counselor is going to help you plan a realistic budget and to implement it. You\’ll also learn how to come up with
practical decisions regarding outstanding debts.

If you ad good standing accounts to your credit report and ask for help from a credit counselors or credit repair companies you will surly start to improve your credit score. The catch with credit score is that it is going to take you a long time to repair it and it has taken you a very little time to raze it.

When you get stuck in bad credit, you need to know that there is no short cuts to getting you out. You\’ll have to rebuild your credit score little by little. Avoid any offers that promise a quick credit repair, apply a long and serious approach to it and learn from your mistakes.

At Debt-Free-Family.com we are dedicated to help you get out of debt, avoid bankruptcy and enjoy a debt free life. Find out how and why to start your own Credit Restoration Program.

Writen By : Nikola Govorko

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Avoid Bankruptcy By Using Credit Counesling Services

Jun 17

Posted by admin in Bankruptcy, Finance

When you face bankruptcy and more debt then you can actually repay, what you need to do is think about getting help from a credit counseling service. Credit counseling service is going to handle your most private information and because of that you should think twice who to hire. Perform a thorough check of the service you want to hire. Make sure you hire a competent and trustworthy service.

First check as many services or companies as you can find on the internet. You can also check your local Yellow Pages but that, in my opinion, is much slower and less efficient way to search. Youll get far more info searching the web and in much less time then searching the Yellow Pages.

By checking up on them via internet you can get costumer reviews, also ask around about costumer satisfaction on the internet groups and forums. You can also check for a BBB (Better Business Bureau) signs (these are not awarded easy) and other marks of the reliable service.

Credit counseling agencies offer myriad of services, some will offer you their service free of charge, while others will do that if they deem you in need of their service. Naturally there are also services which youll have to pay for. Some are going to ask you for up front payment, while others will charge you at the end of the process.

Right from the start you need to find out exactly how much youll have to pay for their services, you dont need any surprises here. When you decide if you are going to be able to hire a certain agency, you can sign the contract and start with your credit repair. Most of the work from now on will be handled by credit consolidation service.

Credit counselors will help you come up with a plan to repay all your debts, theyll outline what you need to do in order to clear your outstanding balances. The credit counseling service will take in calculation all your income, as well as any possible unforeseen financial troubles that can come your way, like unexpected medical bills for example.

All your debts are then merged in to one monthly based payment. Sometimes your credit counseling service may decide to buy your debt from the creditors. The agency can also mediate between you and your creditors and convince them to extend the grace period, accept a lump sum payoff or suspend the collection for some time.

Credit counseling service can help you to speed your way out of debt, but not even they can erase 100% damage you have done to your credit score in the past. Even if it can take you some time to clear negative items from your credit report, by working with a credit counseling agency you can significantly speed up your effort.

Hiring a credit counseling agency will enable you to start making regular payments and that will have a positive effect on your credit report and it will also be extremely important for any of your future credit applications.

At Debt-Free-Family we are dedicated to help you get out of debt, avoid bankruptcy and enjoy a debt free life. Get all the answers to bankruptcy questions.

Writen By : Nikola Govorko

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Credit Trouble Could Easily Become Job Trouble

Jun 11

Posted by admin in Bankruptcy, Credit, Debt Consolidation

The credit report has become a vital tool in doing business in America. Lenders, landlords, and utility companies routinely check to see if an applicant has a solid history of paying bills. Based on that information, they will decide if doing business with the individual represented is warranted. For this reason, as well as making sure that you can get favorable loans, it is important that consumers take care to make sure that their credit report is a healthy one. There is another, equally important reason ? to make sure that you can get a good job.

The job market has changed over the years. A generation ago, a company that was interested in hiring someone would simply call their last employer and ask a few questions about that person?s tenure there. Such questions usually involved such things as whether or not the employee was prompt, finished assigned tasks on time and whether he or she got along well with coworkers. Such phone conversations usually settled any issues that might arise regarding whether or not a prospective hire was a good risk. Times have changed, and today, out of fear of lawsuits, most companies will offer no useful information about former employees. They might volunteer hire and termination dates and perhaps salary, but nothing else. That has forced companies to look for other sources of information, and the credit report tops the list.

A check of an applicant?s credit report won?t reveal whether or not they got along well with others or how good their work might have been. It will reveal whether or not they have a lot of outstanding debt and whether or not they pay their bills on time. The timeliness of paying bills might suggest that the person in question is organized and from that an employer might infer that they could get the job done in the new position. A lot of debt might suggest that the person may not be suitable for high risk or sensitive positions or those involving the handling of money.

Anyone who is searching for a job in today?s market should take the time to make sure that their credit report is accurate and that outstanding debts and delinquencies are kept to a minimum. Today, an applicant?s credit report is almost as important as their resume and any errors or unflattering information could not only cost someone a good rate on a loan, but it could keep them from obtaining their dream job.

?Copyright 2006 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to as href=\"http://www.retro-marketing.com/\">affiliate marketing and informational Websites, including End-Your-Debt.com, a site about href=\"http://www.end-your-debt.com/\">debt consolidation, credit counseling, payday loans and personal bankruptcy.

Writen By : Charles Essmeier

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What Is The Diference Between Credit Counselors And Credit Repair Companies?

Jun 8

Posted by admin in Credit

Just as with lots of other things you do in life, using your budget wisely is a skill you will have to learn, just like riding a bike or driving a car. Some of us are better in this then others, managing money and having a good credit score just comes easier to some people.

If you learn how to manage your debts right, you can preserve an excellent credit rating which is going to permit you to keep receiving credit. And in case that you fail and do not manage to continue with on time payments to your creditors (or even go in default) your credit rating will drop and you will be stuck with a bad credit score until you start credit repair or file for bankruptcy.

One of the ways towards the credit repair is to slowly start building your credit score back to previous level. In case that you are not a financial expert, as most of us are not, you are going to need help in this endeavor. This is where credit counselors come in.

Usually credit counseling is done by profit free agencies, and you should not confuse them with profit oriented credit repair firms. The mayor difference between the two is that credit counselors will provide you with information and knowledge for do it yourself credit fix while credit repair companies will do most of the work for you, but will charge you for it.

If you decide to go with a credit repair company be very careful to choose reputable company with years in business and scores of satisfied clients which can verify their record. Also look for a company which is going to work on more then just trying to remove negative items on your credit report.

Beware of any shortcuts here, and if any illegal activity is suggested (like getting a new address and through it a new credit rating) run away without turning back, that company is a scam. You can also do a good deed and report them to FTC, it might prevent other people from falling in their trap.

By contrast a credit counselor is going to give you advice about fixing your credit report yourself. One very important advantage of that is that by attempting credit repair yourself you will be learning many things about financial responsibility and financials in general.

Before you begin you should prepare yourself for a long and hard battle, which will require an enormous amount of self discipline, time and patience. However by working with credit counselor, you will be getting a lot of help in making long term financial plans that you are going to need in order to start successful credit repair.

Look for a credit counselor which is going to provide you with workshops and educational materials as well as with advice. It will help you to learn how to plan your budget and how to stick to it, this is going to be of a major benefit to you over long time.

You will also receive a personal consultation. That way you will be able to study and learn how to make vise financial decisions based on your personal financial experience.

One other thing you should know is that by using a credit counselor for your credit repair effort, you will gain several major benefits you would not receive from a credit repair company. First is that your credit repair will be long term, you will be learning how to handle your money wisely and thus making a long term changes to your financial habits. By doing that it is very unlikely you will ever find your self in a financial trouble caused by overspending again.

At Debt-Free-Family we are dedicated to help you get out of debt, repair your credit and enjoy a debt free life. Find out how to start easy Bad Credit Repair.

Writen By : Nikola Govorko

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FACTS Consumers Should Know BEFORE Considering Debt Consolidation Or Credit Counseling

Jun 4

Posted by admin in Credit, Debt Consolidation

There is one topic which every time I write about it seems to generate some hate mail while at the same time spawning a flurry of wonderful praise from consumers. Of course, the hate mail is always from a few people that happen to own these ?certain types? of businesses I discussed and those businesses of course are Credit Counseling or Debt Consolidation companies; of which many ?claim? to be non-profit organizations.

You?d almost have to be an ostrich with your head stuck in the sand to not see or hear at least one advertisement a day from a Credit Counseling or Debt Consolidation Company. However, you can expect this to change and change soon. Since this is a topic which tends to ?stir up? the owners of these businesses, I am going to take a different approach by NOT sharing my opinion, but rather, the opinion of others. I will start with the news media and the Internal Revenue Service:

?(NPR News, May 15, 2006). The Internal Revenue Service is revoking the tax exempt status of some of the largest credit counseling agencies in the country. An IRS investigation disclosed that the firms solicited business from people seriously in debt and that they didn\’t provide counseling or consumer education, as required.

Prodded in part by a congressional oversight committee and consumer advocates, the IRS began investigating dozens of credit counseling agencies — most holding non-profit status — two years ago. IRS Commissioner Mark Everson says the companies \”poisoned an entire sector of the charitable community.\”

Everson says in many instances, companies were organized merely to funnel business to loosely affiliated for-profit companies. Many of the firms spend millions of dollars on commercials that urge anyone with debt to call them to solve their financial woes. And because tax-exempt organizations are not bound by the federal do-not call list, the firms were able to randomly call consumers, pitching their services under the guise of a non-profit counseling service.

The IRS investigations are also likely to affect consumers, thanks to a new bankruptcy law that requires consumers considering bankruptcy to get counseling before they are allowed to file. The IRS wants to ensure that only legitimate non-profit agencies are doing the counseling. In addition to the actions announced Monday, the IRS is sending more than 700 compliance letters to the rest of the credit counseling industry (END).?

Since almost all Credit Counseling and Debt Consolidation companies claim a non-profit status, I feel most consumers are easily sucked in with their skepticism and defenses at bay. After all, when most of us hear the word ?non-profit? the first thing we usually think of is a church or homeless shelter.

From the NPR article and the actions of the IRS, I think it?s fair to assume that many of these ?non-profit? organizations have been operating under a scenario similar to that of a wolf guarding a hen house. However, this doesn?t mean all credit counseling and debt consolidation companies are bad but? you do need to know the truth about how they operate and their limitations.

The first thing you want to understand is these companies are ALL more interested in making money off you than they are in preserving your credit rating. The bottom line with either credit counseling or debt consolidation is that it absolutely ruins your credit. I can just hear the companies arguing this with a consumer right now, telling them nonsense like ?It helps your credit since it tells creditors that you?re working on your situation and not just running away from it.? Listen? if one these places tells you that than watch out. Why? Because they will lie to you about other things as well!

One of the first actions these programs usually requires you to do is for you to CLOSE all your revolving credit accounts. You then make payments to the organization and they take care of everything for you. What this says to all your creditors (as well as anyone considering giving you credit) is that you are so out of control with your finances that you can?t even manage paying everyone back on your own. Therefore, you?re hiring someone else to do it for you!

99% of the time these companies will claim they can negotiate with your creditors and get interest rates reduced thereby saving you money. While this is true, what?s also true is you can easily negotiate these same rates as well as they can by just calling your creditors yourself. You?d be amazed at how many of your creditors would love to hear from you (especially when the chips are down!). Not too mention, any money the counseling company was to save you would more than likely be sucked back up by their monthly fees (usually around $500 to $1,000 per year).

This brings us into a whole other dynamic of their business model. Because these companies always make their money off of monthly fees paid by the consumer, the longer they can keep those monthly fees coming in the more profitable their business will be. It?s for this reason that most consumers who sign up with these companies usually find themselves on payment plans with the lowest monthly payment possible (which turns out to also be the LONGEST payment plan as well). Not surprising is it?

Am I against Credit Counseling and Debt Consolidation companies? Absolutely not. After all, there are millions of people in America who will never be able to manage their finances. Credit to them is a destructive addiction much like alcohol or drugs and they will never be able to control it. Instead, it will always control them. We?ve all seen these people. Every time they are extended credit shortly thereafter they are in financial trouble (usually blaming it on some external factor). For these people I think these credit and debt counseling programs can be a good thing (as a ruined credit report is not a hindrance to them but actually an asset). It keeps them out of future financial trouble by forcing them to live their lives on a ?cash and carry? basis; which is ultimately conducive to a better standard of living down the road.

On the other hand. If you?re good with your finances and have control with credit but went through some type of hardship beyond your control in the past (i.e. divorce, job loss etc); then the services of these companies will never be for you. You will do far better and preserve your credit rating by taking matters into your own hands. Reason being is that you understand your credit rating is a powerful tool that can help you move ahead faster, help others and help yourself as well as create the life you want. It all comes down to self management. We all know that those who cannot manage themselves will ultimately be managed by others. Credit is no different. When you learn to manage it well, you are the master and it is the servant.

If you care about your credit and want to benefit from it in the future, then you will never rely on a credit or debt counseling service to help you get out of any trouble you find yourself in. Instead, you?ll look inward and get yourself out while preserving your credit rating the best you can. Credit and debt counseling is for people who are ?ok? with throwing their credit rating in the trash so they can have ?someone else? manage their payments for them (since they are unable to manage them themselves). And again, as far as negotiating interest rates, you can do just as good as them or better. If you don?t believe me just call any of your creditors and straight out tell them your situation. You will quickly find you don?t need to be afraid of them. They just want to get paid like the rest of us.

Jay Peters is the founder of Consumer Education Group which publishes the Credit Secrets Bible (in print since 1994). To receive Free Credit Tips including ?how to get your credit reports for free? visit their website: http://www.CreditSecretsBible.ORG

Writen By : Jay Peters

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Are You Drowning In Debt

May 24

Posted by admin in Debt Relief

If you are deep in debt and it seems that there is no way out, there is hope. Credit card counceling and/or debt consolidation may be the best solutions to your problems.

A credit counceling professional can help you establish a plan to get out of debt and help you learn ways to stay out. Credit counselors will work with you to create a debt management program, which may include debt consolidation, and they will also educate you on how to avoid the careless spending and lax payments that landed you in debt in the first place. With the help of a credit counselor, it won\’t be long before you are transformed into a responsible and reliable consumer.

When you begin a debt management program, your objective is to completely eliminate all of your debt. Therefore, you must do whatever it takes to reach this goal. So don\’t be afraid to ask questions and don\’t worry about appearing unknowledgeable. The credit counselor is there to help you and answer any questions you may have. So ask plenty of questions, and if you still don\’t understand something, simply ask your counselor to explain again.

If your debt management program includes debt consolidation, be sure to ask about any conditions, such as whether you will be able to continue using your credit cards after the debt is consolidated. Oftentimes, consolidation programs stipulate that you must forfeit the cards once the debt is consolidated. This may or may not be the best decision for you. However, if you really want to get out of debt once and for all, you may want to consider not racking up any more credit card debt.

Lastly, feel free to do some of your own research. After all, you want to make sure that you are with the right debt counceling company.

George Davidsberg usually writes detailed reports on areas dealing with credit consolidation and credit loan. You can discover his work on credit counceling over at www.creditenio.com/councel.html and other sources for credit counceling tips.

Writen By : George Davidsberg

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