Even the debts that stand late at 30 days or more have been declining each month. It is good news as the default data is an indicator of how defaults will play out in the future. Card payers seem to be eliminating balances racked up during the holiday shopping season for all major credit card providers across the board.

For Bank of America, the news is much different than it was in August 2009 when the bank had to write off 14.53% annualized of its consumer credit card debt. It also appears the card holders are getting more focused on eliminating credit card balances consistently. With the lowest default rates the bank has seen in three years, there is hope for US consumers staying on top of revolving debt. The national average of credit card balances has also dropped from $799.7 billion in December 2010 to $795.5 billion in February. Those statistics are similar to the numbers in the fall of 2004.

Customer Defaults Decline Again for Bank of America (NYSE: BAC) was created by and is property of American Consumer News.

Secured Loans
A secured loan is a loan that is secured by items of value that can be seized by the lender in the event of a default on the loan. Also called collateral, the items that are used to secure the loan are often examined by the lender before they approve the loan to make sure that the value of the item is as much as the borrower is claiming it to be. It is believed that holding the ability to seize these assets will reduce the chance of the person defaulting on the loan and if the person does default on the loan, the lender has a chance to reduce their losses by selling the assets used as collateral for the loan.

Secured loans are generally made to people that have a blemished credit history or a lower credit score than the lender is comfortable with. These loans have higher interest rates associated with the loan and the amount of money that is loaned under a secured loan is often less than what could be obtained with an unsecured loans. The lender would rather have the loan repaid under the terms of the agreement, but being able to seize the collateral that has been attached to the loan will mean that the losses suffered by the lender under a default will not be as great.

Unsecured Loans
Unsecured loans, such as Payday loans and Cash advances, are typically viewed as the most desirable type of loan available to people today. These loans are typically made to people that have an excellent credit history, a very good credit rating, and have a high enough salary to easily repay the loan without creating a financial hardship. No collateral is required for an unsecured loan because the person has demonstrated that they will be able to repay the loan and the interest with no problems. For people that have a good history with the lender that they are using to obtain their loan, obtaining an unsecured loan can be accomplished in a short period of time.

The type of cash loans which are offered to the person will depend on many different factors. The lender will look at the credit history of the person to determine whether the person has ever had a problem with paying their obligations on time as well as the value of the items put up as collateral for a secured loan. If the lender determines that the person may be a credit risk, the person will be offered a secured loan but if the lender determines that the risk of default is minimal, then the person will be offered an agreement for an unsecured loan.

Unsecured and Secured Loans: How They’re Different was created by and is property of American Consumer News.

Two years ago, an estimated 25% of income-earning families were receiving food stamp assistance. Now, in 2009, more than 40% of families with jobs are getting aid and the numbers are rising. As the unemployment rate also keeps rising, those who are still working have found that the economic changes in companies across the nation have been forcing workers to find supplemental help. Employers have had to cut back employee hours and many of the working families have been forced to accept part time work because full time jobs are harder to come by.

Debt Plays a Role

Consumer debt is also a huge factor that is plaguing American families. During the credit crisis, many credit card companies have increased interest rates and minimum monthly payments, leaving debtors with less cash left over each month to go toward food needs. Mortgages are also leaving consumers in a financial bind because of the increase of foreclosures and a families effort to avoid foreclosing on their family home.

With all of the consumer debts and financial obligations, consumers are turning to the federal government in order to eat. Congress added an additional amount of money to the food stamp program to ensure that food stamp recipients can receive assistance. The average program participant receives $300 a month is food stamp assistance.

High Demand Yields Law Suits

While it may have once been considered only a welfare program, consumers with families are recognizing that they need more help. This is leaving many states with a program that is hard to handle. In the state of Texas alone, more than 2.8 million citizens receive food stamp help. With some programs failing to be effective due to the high demand, class action suits are now being filed that accuse the state of violating federal rules where all food stamp applications need to be processed within a 30 day time period.

As many consumers have stopped using credit cards to buy groceries and have exhausted their options for personal loan, the food stamp programs across the nation will likely be inundated with new applications for help each day. Until the nation’s economy steadies and more full time work is found, the numbers will continue to rise.

Growing Number of Working Class Now Accepting Food Stamps was created by and is property of American Consumer News.

Unscrupulous practices. The one issue that comes up consistently is their apparent lack of action once they have begun to take your money. The job of a debt settlement company is to negotiate a settlement amount (lump sum) with your individual creditors so that they can be paid off in full. That activity needs to be on-going while you are building up cash in order to pay off the account balances. Be sure to get any offers in writing from the debt settlement company that they claim to have worked out with your creditors.

High fees. This type of debt relief comes with a price: high fees. These charges are collected up front because of the nature of the type of settlement that they offer. Once a creditor is paid off, you no longer need the debt settlement company, so in order to protect themselves, you will have to pay money up front for their services. These charges can be several hundred dollars.

Non-compliance by creditors. Some creditors refuse to work with debt settlement companies because of the questionable ways that they have in dealing with the creditors.

Escrowing funds. Debt settlement companies take your money to pay your creditors and escrow it (put it into their own account) in order to pay the debts off to your creditors. That is all well and good, but when do those payments take place? Once an agreed settlement has been reached it should be right away, but sometimes is not. Questions have arisen as to the ethical practices of allowing that money to sit in the coffers of the debt settlement company as long as possible in order to earn interest before it is paid out.

Asking for more. Debt settlement companies are notorious for asking for more money from debtors. Fees and charges should be known up front and should be clearly spelled out in a signed agreement. This is the only way to combat this type of activity.

If you choose the debt settlement method of dealing with your debts over credit counseling or debt management plans, then be sure to do your homework and check the backgrounds of the companies for which you are considering. A little research can save you a lot of headaches and a lot of money. It is worth the effort.

5 Reasons to be Wary of Debt Settlement Companies was created by and is property of American Consumer News.

• It never hurts to ask- If you have seen an increase in your interest rate and have a good history with your credit card company, you should contact them to see if they will lower your rate. This strategy has been popular in the past with mixed results. Consumers should be prepared for an uphill battle to get a reduced rate since the credit card industry is not exactly noted for accommodating the requests of card holders at this time. With that in mind, there is no harm in making the call. It could save you thousands of dollars and if it doesn’t, there is no harm done.
• Opt out of higher interest rates- Card holders may have the option to opt out of the higher rate. This requires paying off your balance at your current rate without making new purchases. If you choose this option your current rate will remain in place however using your account, even one time will trigger the higher interest rate. Carefully read any information that accompanies your credit card statement or other correspondence you receive from the card issuer to ensure you understand the terms before agreeing to them.
• Shop for a better rate- If you are not satisfied with the terms and conditions of your current account, start seeking a better deal elsewhere. Balance transfer offers are not as lucrative as they once were, but they are still available. Before moving your balance, calculate how much money you will save by transferring your balance. To do this, consider balance transfer fees and the length of time you will be able to take advantage of the lower introductory offer.

The final and most effective way to avoid the negative consequences of high interest rates is by managing your credit wisely. Consumers who manage their accounts responsibly reduce or eliminate the consequences of late fees and high interest charges by paying their balance in full each month. Of course many people are beyond the point where paying off the balance in one month is feasible. If there was ever a time to aggressively tackle debt the time is now. Research the options available to you and develop a strategy to get out of debt once and for all.

Interest Rate Hikes And What You Can Do About Them was created by and is property of American Consumer News.

Here are some do’s and don’t to surviving the recession’s tough times:

The Do’s

Paying Off Debts – Even though it may mean sacrificing in other areas, it is very important that you continue focusing on the debts you have already accumulated. Falling behind will mean even bigger problems financially down the road. Don’t ignore the creditors and pay at least the minimum on your debts, if not more.

Continue to Pay Yourself – Keep putting money into your 401k and other savings and investment plans. It may be very tempting to withdraw that money to get you out of trouble in the short term but for the long-term it is best your money stays put. Even though the market is unsteady, it will settle down at some point. Withdrawing money now will certainly cost you money in fees, penalties and taxes.

Put More Effort in Your Taxes – Itemizing your taxes can help you qualify for additional tax breaks and deductions you might not find by only filling out only the simple forms. You must also be patient when it comes to waiting on your tax refund. Being too hasty and taking out an anticipation loan for speedy cash will cost you a lot more than you can probably afford to pay.

The Don’ts

Feel Guilty or Alone – Because so much of the nation is experiencing the same financial problems as you, there is not reason to feel bad for not being able to afford things. There are many consumers who can not afford a pricey dinner out or a big vacation this year. It is more important to be frugal with money and be grateful for all of the things you do have. You are certainly not the only one working hard to stay on financial track.

Forgo the Sales – While it is always great to find a bargain, it can also be too tempting to buy more than you need. If you are using coupons wisely and following sales on the items you truly need, it can be a great way to save money. However, if you are just jumping at every clearance rack you see, you are likely spending money you don’t have on things you don’t need.

The Do’s and Don’t of Recession Time was created by and is property of American Consumer News.

Whether you are in over your head or just starting out, in order to escape or keep yourself from visiting the “Debt Trap” is to have a good sound financial plan. It wouldn’t make much sense to go hiking in the woods with out a compass; likewise, it’s not very sensible NOT to have a “compass”, or financial plan for your journey ahead. You don’t have to be rich in order to have a plan, nor will having a plan make you rich. It simply helps you make what you have work.

The number one thing you need to do when constructing a financial plan is a budget.

Five ways to assist you in creating a budget are:

1. Discuss with your partner your financial goals you both have. Be realistic when setting these goals. You will be more likely to achieve these goals if they are within reason.

2. Gather all the necessary information i.e., pay stubs, bills, receipts, anything that will help you get an amount of your income and you’re spending.

3. Obtain a budget worksheet. There are many on the internet that you can download or you may decide utilize a financial software program for your computer. (Quicken QuickBooks and Microsoft Money are examples)

4. Together, devise a budget. This will ensure you both know and understand your financial status.

5. Chances are your budget will not work out the first time. Like anything else being created, it will need some “tweaking”. This is the hardest part because it takes time, consistence and patients.

Now that you have a budget in place, you need to make it work.

Keep it up to date. Take time to look over it each year and making any modifications. Your income and expenses will change over time; therefore, your budget will need to as well.

Keep it simple. Don’t make maintaining your budget be a full time job.

Expect the unexpected. Keep enough money in your budget to cover any surprise bills that may come find you.

BE HONEST. This is one of the number reasons a budget fails. Make sure your numbers are really what you earn and spend.

Progress is hard to achieve without a plan!

The “Debt Trap” was created by and is property of American Consumer News.

• Empowering Mom: Wow, apparently being a work-at-home entrepreneur can induce a great deal of envy! Don’t let envious people get you down.
• The Frugal Duchess: Here are some great personal lessons that we can take from the Obama campaign and presidential election process.
• No Credit Needed: Today is your day. Don’t wait until January 1st to make your resolutions and get your finances in order!
• I’m In Debt: Here’s a great set of resources that should help you save money on your Christmas shopping expeditions.
• Discover Debt Freedom: What are some ways to avoid incurring credit card late fees?

The Digerati Life Presents: Carnival of Personal Finance #178 was created by and is property of American Consumer News.

Being in debt, no matter how deep or how recent, is not the end of the world. The key is to attack the debt head on. For this you need to start with a plan. The first step of such a plan is to collect all of your bills at the same time and analyze what is going on with your account. On a piece of paper, write down the name of the account, the total balance due, the minimum payment due each month, and the amount of the interest rate charged. Make certain you have included all of your bills. Ordering a copy of your credit report can help to ensure you have included all of your debt and can help you understand the exact nature of your personal financial situation.

After you have listed your debt obligations, look over your list and determine which of the accounts charge the highest interest rates. Number each account according to the interest rate charged. For instance, the account with the highest interest rate should be listed as number one, and so on down the list.

Once you have created your list of debt, start working on your budget. Total up all your sources of expendable income and develop a budget for a month. Be sure to include daily living expenses and the like. Your priority will be to pay off the bill with the highest interest rate first, despite the remaining balances. Many people make the mistake of paying off the accounts with the highest balances instead of the highest interest and find they never get anywhere.

When creating your plan of attack on the high-interest accounts, figure out how to make payments that are double or triple the minimum payment required until the account is paid in full. As one account gets paid in full, take that payment and move it to the next high interest account. Continue on this payment plan until your accounts are paid off and current. You should find that it becomes less difficult to deal with overwhelming debt once you establish a cycle of budgeting and payment plans. If you find you can not afford to double up on payments and still live an adequate lifestyle, you may want to consider finding new employment with a higher pay rate or perhaps take on a second job and dedicate those funds to paying down your debt.

Pay Attention to Your High Interest Not High Balance was created by and is property of American Consumer News.

First, in order to get the phone calls to stop, you need to face up to and deal with the situation. If you dispute any part of the amount they say you owe, you have the right to respond in writing within thirty days of receiving notice from a collection agency or the debt collector. If you do owe the amount stated but want the phone calls to stop, send a letter to the collector who has been calling to tell them to stop contacting you by phone. Once you have made the collector aware of your request, they can only utilize contact by phone or mail to tell you about legal action they are taking or if they are going to stop collecting the debt. If any debt collector calls you at your place of business or during a time not in between 8 in the morning or 9 in the evening, you can file a complaint with your state’s attorney general’s office.

When attempting to negotiate repayment of an overdue credit card debt, do all of your talking on paper and send it using registered mail to ensure the company has received all of your correspondence. Keep accurate records of the information you have sent and received, including copies of all letters. Keep your cool as you try to work through a payment negotiation. When you do reach a unanimous decision, make sure you stick to your word and follow through with your commitment to pay off your debt. Take on a part-time job or find odd jobs in the neighborhood to help supplement your minimum payments and pay off your debt faster.

It can be easy to get off track with your finances, especially when something unexpected comes up and throws off your budget. If you find that you are falling behind again at some point in the future, you can save yourself a lot of aggravation and ringing phones by contacting your credit card company first and explaining your situation. Most companies will work with you if they trust you are sincere about your efforts to pay and get yourself back on track with on-time payments. At that time, you may be offered a customized plan that works better with your financial situation and budget.

Don’t give up on or ignore your credit card crisis or you will end up paying for it for a long time to come. Do take responsibility for what you owe and work hard to put that debt behind you.

Getting Yourself Back on Track With Delinquent Credit Card was created by and is property of American Consumer News.

For several months a lot of the major mortgage lenders stopped providing some of the worst offenders in the sub-prime mortgage loan market. Very few companies were offering option payment loans, 50 year mortgages, and interest only loans with a massive balloon payment at the end of the term. It seemed that the mortgage market had returned to sound statistics and reasoning as to whether or not to originate a loan, but as the real estate market decline very few people were buying homes and thus very few people were taking out mortgages. The volume of mortgages that the real estate industry has seen has shrunk dramatically, leading some mortgage companies to desperate measures to originate new loans.

Many of the mortgage companies which were hit the hardest by the collapse of the sub-prime lending market are now offering the same types of loans which got them into that mess in the first place because they’re so desperate to generate any type of new mortgages they can. Countrywide Home Loans is sending out mailers with offers for a $511,000 jumbo mortgage to refinance or remortgage your home. According to the LA Times, aI I number of other mortgage companies are sending out flyers for option payment loans, which are loans in which the customer is not even required to pay off the interest each year! If you’re in brittian, consider a buy to let mortgage.

Just because these loans are becoming available again does not mean you have any business taking them out. You might get initially a low payment for the first few months, but after that the rate will adjust upward and you’ll be paying much more in the long run. Stick to a conventional 15 or 30 year fixed mortgage, pay your payments each month, and you won’t have any surprises along the way.

Lenders Still Making the Same Mistakes Which Caused the Sub-Prime Mortgage Mess was created by and is property of American Consumer News.

A charged-off debt occurs when money is owned to a company by an individual and goes past due.  After the company tries to collect a debt repeatedly but fails to secure the repayment, the company will then “write off” the debt, which is considered to be income for the company and therefore an asset.. When the company decides to write off the debt, they will reduce the total amount of profit for the company and lower company taxes.

The charge-off is reported to the credit agencies and ultimately will make it harder for a consumer who has charged-off accounts to get other loans or secure credit in the future. A charged-off debt will remain on a credit report for up to 7 years and the consumer is still bound to pay the amount in full. However, once a debt goes into a charged-off status, penalties, interest, and other fees can increase significantly, making it even more difficult to repay the original loan or payment amount.

Generally the terms of what happens when an account is placed in charged off status can be found in the tiny print on the initial contract signed in order to get the loan or the line of credit. Even after the status of the loan has been changed to a charge-off, the original agreement and terms still apply and are the responsibility of the consumer. When the consumer decides to work through the charged-off debt, they will need to find out what the statute of limitation is on the original debt based on the state in which they live and understand the type of debt they have. The statute of limitations is usually between a 3-6 year timeline and after that period expires, the consumer is not longer required by law to repay the money. By signing any additional agreements, making a payment, or by simply validating the debt, could restart the statute of limitations timeline, lengthening the time period the consumer is still legally required to pay the debt.

Be forewarned, even if the debt is passed the time of the statute of limitations, a debt collector can still legally pursue the consumer for repayment and the original lender can still attach interest and penalties onto the total amount of the original loan. Depending on the applicable laws, creditors can attempt to garnish your wages, place a lien on your assets, or take other measures to recover the money owned.

Consumers, who decide to make payment arrangements or agree to pay a certain amount of money if the company will agree to consider the amount payment in full, must get any agreements put in writing by the company. Negotiating directly with the original lender may produce better results than working with a debt collector, who usually makes money based on the amount collected. If the debt is negotiated and considered to be paid in full, the negative mark will still remain on the consumer’s credit report. In some cases, the lender may be willing to remove the account from a credit report if paid in full. Only the original lender can initiate this action. A debt collection agency can not, despite what they may claim.

Responsibilities of Paying a Charged-Off Debt was created by and is property of American Consumer News.

The idea began when several entrepreneurs started seeking out savings plans that operated similarly to the 529 College Savings Plan. In theory, the small amount of money taken from each paycheck to save for the kids college education, eventually added up to quite a nice sum of cash. Using that same theory, Smartypig.com was created as a way to save money for vacations, special occasions, or even a nice big screen television.

Once registered on Smartypig, users can set up an account and establish goals for which they are saving. The account is free to set up and use. You provide information about the item or event you are saving for, how much it costs, how much you can afford to spend, and your target date to have all of the money. Smartypig will recommend how much money you should deposit and you conveniently set up an automatic deduction from your bank account. There is a minimum opening deposit of $25 required and a minimum savings goal of $250.  In addition to the money you deposit, Smartypig also enables you to allow your friends and family to help you meet your money goal. Each money transfer will cost a small fee. You can invite them or visitors can search for your account by entering your email address and easily contribute to your account.

The money collected in the Smartypig account will continue to add up and collect interest until your savings goal has met at which time you can opt to retrieve your money via a Smartypig MasterCard or by selecting a gift card from one of many participating retailers. The retailers may also offer bonus incentives towards the item for which you are saving.

Smartypig has a lot of the same terms as a bank account and is still carefully monitored to protect against national security concerns and other illegal money practices. When registering, you will need to be a US Citizen and over the age of 18 (unless you open an account with a parent). You will be asked to provide several forms of identification including your drivers license number, social security number, current and previous address information, email address, date of birth, and phone number.

Smartypig appears to be a one-of-a-kind savings plan for consumers who are looking to avoid credit card debt and instead, use cash savings to make purchases, afford vacations, or any item they are looking to get. It may be a new kind of incentive for people to start saving money towards fun things instead of just for paying bills.

For more information, visit http://www.smartypig.com/.

WEBSITE REVIEW: SMARTYPIG.COM was created by and is property of American Consumer News.

Living on less, or thrifty living, doesn’t necessarily mean you have to do without everything, though. 

1. Know where your money is currently going.  Before you can make any changes for the better, you need to know where you spend your money.  Go back over your spending for the last month or two and see how much of what you spend goes to necessities and how much goes to satisfy “wants”.  Are their things that didn’t satisfy either?  You will probably find areas in your regular spending that can be reduced just by looking at your current habits; and that money can be used someplace more important- like to pay for groceries or a bill.
2. Buy store brands.  Do you really need to have a box of cereal with the brand name on the box?  Many of the store brands are exactly the same as the brand name version, but can save you considerable amounts of money.
3. Use Cash.  Whenever you physically spend cash instead of swiping your debit or credit cards, you feel it more.  People who buy with cash will almost always spend less than people who are buying on their debit or credit cards.
4. Look at a different way to pay for your mortgage.  If you pay once a month, you should look into paying for your mortgage twice a month (every other week).  Simply break up your monthly payment into two payments and pay that way- it can often save you years off the end of your mortgage term (and thousands of dollars in interest). 
5. Use the 24 hour rule.  If ever you are out and have the urge to buy something, make yourself wait a minimum of 24 hours before you make the purchase.  If after 24 hours you still really need/want the item, then you can consider buying it.  But by enacting the 24 hour rule, you will overcome most impulse purchases.
6. Pay yourself first.  Before you have a chance to spend or pay bills, transfer a portion of your income to one of the many high interest savings accounts on the market.

Six Ways to Become Money-Wise was created by and is property of American Consumer News.

Already being in debt and then being taken for a ride by some fly-by-counselor would be utterly devastating to both you and your financial situation. It is essential you do your homework before you commit to any credit counseling company. The first step is to check out the US Department of Justice website. They provide a list of companies who are approved to assist client with their debt. All counselors who are on the approved list must be non-profit organizations and are subjected to criminal background checks. They must also comply with governmental training and experience guidelines in order to be placed on the list. Included in the governmental guidelines is a company’s requirement to be bonded, or carry insurance in the event a company employee causes you to lose money because of their own mistakes or criminal intentions.

When contacting a credit counselor for an initial consultation, keep your ears open for some red-flag warning signals during their pitch. Any company who tries to force you into committing to a payment plan outright should be a warning. Legitimate counselors should want to help you explore all of your options, including the option to reduce your debt on your own by altering your budget. A counselor’s goal should be to initially go over every detail of you finances and then help you decide which method would work best for you. Imagine someone forcing you into declaring bankruptcy, when in reality all you had to do was simply adjust your budget.

Counselors who charge upfront fees that seem ridiculously high should be more-carefully evaluated. Many companies will require a monthly processing fee ($25 is average) and some charge a nominal set-up fee to get you started. A good way to reveal a dubious company is if you state you can not afford the fees and they immediately turn you away. The dishonest companies will also require a large sum payment in order to move forward with the company. On average, any company you deal with who has a fee over $50 on a monthly, administrative basis, should be considered and researched carefully.

For a list of reputable, approved counseling companies, visit the US Department of Justice at http://www.usdoj.gov/ust/eo/bapcpa/ccde/index.htm.

Fed up with scraping the pennies together at the end of the month? It’s time to get impartial debt advice from professionals in debt management to help you get out of debt through an IVA, a consolidation loan or another debt solution tailored to your money needs.

CHECKING OUT COUNSELORS OF CREDIT was created by and is property of American Consumer News.

One of the most common things people do when they’re out of money is to borrow more of it to pay for school. This is something that American Consumer News does not recommend. Taking out Stafford loans isn’t that big of a deal because the amount you can borrow is relatively low and won’t take that long to pay off after you graduate, but when you start taking out large private loans at much higher interest rates, you’re then asking for trouble when you get out of college. Solving your collegiate financial problems by borrowing more money than you already are will almost certainly leave you with $30,000-$50,000 in student loan debt by the time you graduate.

Another option is to take some time off from school and work so that you can save up money to pay for school. By doing this, you’ll likely be able to save the money that you need to, but when the time comes to actually go back to school, statistically you won’t. People who “take a semester off” are very unlikely to come back after a semester.

There’s a third option that’s a happy medium. Instead of taking a full-credit load, take a half-credit load and then work twenty hours a week. This will decrease the size of your tuition bill and significantly increase your income. You’ll still be taking classes and involved in the collegiate life, but you won’t be piling up crippling student loans in the process. It will certainly take you longer to graduate college this way, but at least you won’t come out of college with piles of debt. While you are doing classes half-time, you can look for scholarships and look for alternative ways to pay for your education so that you can tke a full-load again.

What to Do When You Can’t Afford to Pay for College Anymore was created by and is property of American Consumer News.

The first thing you need to do is establish how far of a hole you’ve dug. How much did you spend on presents this year? Where did that money come from? Once you know how far deep your hole is, you’ll have a pretty good idea of how hard you have to work to get yourself out of your Christmas debt.

For the sake of this discussion, let’s say that you spent $1,000 on Christmas presents this year. That means your net-worth is $1,000 lower than it would have been otherwise if you had not purchased Christmas presents and to make up for it, you’re going to have to find an extra $1,000. It might seem like a big number, but it’s actually not that much money when you break it down.

Taking care of any Christmas debt on your credit cards should be your first priority. Usually they come with interest rates of 10-20%, so we want to get rid of them before compound interest really starts to work against you. If you have any decent chunk money in savings, it probably would make sense to throw that money on your credit card and then rebuild your savings account to avoid the nasty interest rate. If you don’t have a lot of money in savings, you can still take care of your Christmas debt the old fashioned way—work!

In order to come up with the extra money needed to cure your holiday debt hangover, ask your employer if you can work any extra hours for a couple of months. If that’s not an option, you can take a part-time job delivering pizzas at night. If you do that for a month straight, it’s really easy to make $1,000! You can take another part-time job doing whatever; you don’t have to particularly enjoy the job, since you’re only going to be doing it for a month or two.

If for whatever reason you can’t get a part-time job, you’re just going to have to sell some stuff. Chances are you got all sorts of presents if you gave a bunch of them away. Maybe there’s something you really don’t need and could get some decent money for in the classifieds, on craigslist, or on eBay. Usually selling stuff won’t get you all the way there though. Sometimes all it takes is good old fashioned budgeting. Plan where every dollar you make is going to go before the month begins. Don’t let yourself go out to eat or spend much of anything on luxuries until that holiday debt is gone. Make getting rid of it a priority in your life, cut back, and it’ll be gone in a couple of months!

There’s no reason to be paying for last year’s Christmas presents 6 months or later down the road. If you accumulated credit card debt this Christmas, get rid of it as soon as possible!

How to Get Over a Holiday Debt Hangover was created by and is property of American Consumer News.

Many people are of the opinion that a credit card is just another account to take money out of when needed. Sometimes we take money out of our checking account to pay for things, other times we just pull out the credit card. We never take the time to consider whether or not the money is actually in our checking accuont to pay for the item when the credit card bill comes due, we just use it and subconciously figure that things will somehow work out. The bill comes, and you don’t quite have enough money to pay it all off, but that’s okay, there’s always next month.

You keep charging casually without thinking about it, not really paying attentino to what your spending it all on, and then second bill comes. You can’t pay it off because you’re spending more than you used to whether you realize it or not, and the balance slowly begins to accumulate. Some people catch themselvse a few months into this pattern and stop themselves before getting to far in debt. Others don’t realize that they are spending more than they making and racking up large sums of credit card debt. Many people find themselves in tens of thousands of dollars of credit card debt after using them irresponsibly for a couple of years. Sometmies they are only slowed down when they reach their credit limit and simply cannot charge anymore! If you’ve spent so much on your credit cards that you can’t make the monthly minimums, you might need to settle debt on your own or use a debt settlement company.

Getting into this pattern of irresponsbile credit card usage doesn’t happen to everyone, but it’s a bad situation that’s a lot easier than you might think to get into. We need to carefully monitor our credit card usage each month and never charge more than we can reasonably afford to pay off at the end of the month. It might even be a good idea to ditch the credit card all together and live on a cash basis if you have had problems with keeping a tight grasp on how much money you spend on them each month.

We should never use credit cards to purchase something we don’t have the cash to pay for in our savings accounts and we should never carry a balance month to month. Doing so is only asking for compound interest to work against you in a very dramatic way and will put you in a substantial amount of credit card debt.

There are many options to help you eliminate credit card debt, including debt consolidation services and some good old fashioned credit card debt elimination by paying extra each month.

Credit Cards: The Silent Killer of Financial Freedom was created by and is property of American Consumer News.

A Lesson Learned – As you put in all of that extra effort in budgeting, spending less, and working more, you’re going to really feel the true financial and emotional cost of borrowing money. It’s really easy to get into debt because there’s no cost up front and everything’s paid through the back end. By working hard and paying off your debt, you’ll be much less quick to jump back into it.

Cash Flow – Instead of writing huge checks to banks, credit card companies and mortgage lenders each month, you’ll actually have control of your money. You’ll be able to decide where you want it to go rather than having your financial obligations deciding where it goes for you.

Decreased Risk – By paying off all of your debts, you’ve significantly decreased the amount of financial risk you have in your life. You won’t have any monthly payments, so if you lost your job, the world won’t come tumbling down. You could probably squeak by with a service job until something better comes along.

Lower Stress Levels – When you’re in a significant amount of debt, it has a tendency to affect you in your inner-most being. We as Americans spend a lot of time worrying about our financial situations and it adds a significant amount of stress to our lives.

More Free Time – After removing debt from your life, you’ll spend a lot less time worrying about money, paying bills, and pouring over the budget to make it all work out. If one of the family members is working an extra part-time job to help pay the bills, after you get out of debt, there would be the freedom to not have to do that anymore as well.

Freedom To Do What You Want – By getting out of debt, you’ll no longer be an indentured servant to your banks and your creditors. If you want to get up and move to another part of the country or the world, you’ll be able to do it! If you want to take a lower salary somewhere else because it’s what you would love to do with life, you can do it! When you’re out of debt, you have so many more options than you did before. You can make decisions without having to question if you’ll still be able to pay your bills, and that my friend, is true freedom.

Financial Freedom: 7 Benefits of Getting Out of Debt was created by and is property of American Consumer News.

Check and Correct Errors on Your Credit Report – Most studies show that 1 out of every 3 Americans have mistakes on their credit reports that are significant enough to cause us to not qualify for the best interest rates available to us. Head on over to AnnualCreditReport.com and check your three credit reports for free to make sure everything on them is accurate and correct! If there are any errors, dispute them and get them corrected.

Reduce Your Consumer Debt – If you have credit cards or other consumer debt, pay down on them! This will lower your debt utilization ratio and improve your overall credit score.

Don’t Open New Accounts – Six months before you apply for a mortgage, don’t sign up for any new credit cards or other accounts. Credit inquiries and opening new accounts will lower your credit score by anywhere from 10 to 50 points.

Pay Your Bills On Time – It seems simple, yet many people don’t keep good track of their finances and make a payment late every once and a while. Even a few late payments will significantly lower your credit score and prevent you from qualifying for an optimal mortgage. Make sure to pay each payment early or on time each and every month!

Don’t Close Paid Off Accounts – A common misconception about credit scores is that if you pay off an account and close it, your credit score will go up. People think that if they have large credit lines with no balance that the bank will think they could potentially just go out and borrow a bunch of money and be in a much worse situation. It would make sense that having a bunch of credit available to you would damage your score, but quite the opposite is true. If you have a large amount of credit available to you, but don’t use it, you will have a much lower debt utilization ratio and have a higher score.

Don’t think that you’re stuck with whatever mobile home loans the bank will offer you now. Take active steps to improve your credit score so that you can get a better loan from the bank.

Looking to Buy a Home? 5 Tips to Improve Your Credit Score to Get a Better Mortgage was created by and is property of American Consumer News.

One of the worst things that can happen to you is credit card fraud. This is even worse if you don’t pay very much attention to your credit reports, since you may not find out about the fraud until there are very serious problems to deal with. Even if it’s possible to get out of paying for most of the fraudulent purchases that are made on your card, you will often have to pay for some of them – and you will have to go through the hassle of dealing with a stolen credit card if you’re not careful.

One of the major places where credit card fraud happens now is online. Therefore, you should be very careful about the companies that you give your credit card number to. Ideally, you should figure out a way to avoid giving out your credit card number at all. There are several payment services online that will help you make your online payments without giving out your credit card number to unauthorized parties.

You should also make sure that if you are entering your credit card number that it is being entered into the right field on the right page, and that it is being sent over a secure connection. If the connection is not secure, then anybody online might be able to find the information that you sent.

Another place where credit card fraud is common is over the phone. For this reason, you should avoid giving your credit card number to people or companies over the phone if at all possible. You should also listen to your instincts regarding the phone and internet. If you have any doubts about the safety of giving your credit card number, then you should probably not do so. After all, when it comes to things like fraud, you’re much better off safe than sorry.

If you do find that there are charges on your credit card that you don’t remember making, then you might be a victim of credit card fraud. Luckily, there are a lot of options to people who think that their credit card might be stolen. The first thing you should do if you think that your card or card number has been stolen is to call up your credit card company and immediately cancel the card. This will keep the person who has stolen your card from using it anymore. While you’ll still have to deal with what has already been done with your card, you will at least have limited the damage.

To keep yourself from being a victim of credit card fraud, however, the most important thing to do is just to use common sense. If something seems shady, then it probably is, and you shouldn’t risk your credit card number if you are unsure of the situation.

Featured Link: Many people find the amount and types of mortgages available to be completely bewildering. At the moment there are over 8000 mortgage plans on offer ranging from basic 100% mortgages to the more popular remortgages. Take time to analyze your options and even better, use a broker to do the hard work.

Don’t Become the Next Victim of Credit Card Fraud was created by and is property of American Consumer News.

Many individuals have been helped by consumer credit counseling to take control of their finances and to eliminate debt. Consumer credit counseling can work for you by teaching money management skills which can help you throughout your lifetime.

Consumer credit counseling can help you better understand your credit situation. It can help you understand the costs associated with misusing a credit card and make you a more informed consumer.

Consumer credit counseling is especially useful for people suffering from huge debt burdens. They can benefit from consumer credit counseling as it can help them find a way out of their present financial crisis. If you have a weak credit history and low credit ratings, consumer credit counseling can show you ways to repair your credit.

By making an appointment with a credit counseling agent, you can get all of these advantages and find out what more the agent can do for you.

Many debt management companies provide consumer credit counseling agents to advise and help individuals find a way out of debt. Debt management agencies help you reduce and consolidate your loans by negotiating with your creditors. Their credit counselors are the ones that teach their clients better ways of avoiding debt in the future and to find ways to saving money to pay back their current debts.

When selecting a debt management company, be sure that they have qualified credit counseling personnel.

Their teams of expert and experienced credit counselors, who have wide knowledge in the finance field, can help the layperson better understand their credit situation and how to improve their financial standing.

The consumer credit counseling agent will first understand the situation you are in. Then they will formulate ways in which you can save more money, become debt free and start on your way towards financial freedom.

These are just some of the things consumer credit counseling services can do for you:

- They can teach you how to better manage your household expenses.
- They can help you deal with harassing collectors.
- They can teach you understand relevant financial issues surrounding your credit.
- They can advise you on how to reduce your debt burden.
- They can help you avoid situations where you may have to declare bankruptcy.

The counselors can work with you to create financial plans such as a savings and budget plan, and help you find ways to sticking to them. Comprehensive plans can lead you to better manage your cash inflows and outflows.

Taking some time for consumer credit counseling can help you get rid of your debt problems and start you on your way to a secure financial future.

If you’re in serious debt and think that the only way out is declaring bankruptcy, the best thing to do is to get impartial and expert debt help. Bankruptcy is a severe last resort if you are in serious debt and no other debt solutions, such as an IVA (Individual Voluntary Arrangement) or Debt Management Plan can save you from going bankrupt. Bankruptcy protects you from your creditors and allows you to start afresh, but you need to think very carefully about all the implications it will have.

Stuck in a Pile of Debt? Consumer Credit Counseling Can Help was created by and is property of American Consumer News.

The problem with co-signing other people’s loans is that there are just no up-sides. You are taking 100% of the liability and none of the benefit. Your friend gets a new car and you get chased after by debt collectors if he or she does not pay off his loan. What kind of deal is that?

Most people end up co-signing loans because they believe they are helping out a friend or family member in need. In almost all cases, you aren’t helping the person who thinks he or she needs a loan. Carefully consider the reasons why the bank asked for a co-signer. Does the person who wants you to co-sign for the loan make enough money to pay it off? Have they had a history of not repaying their bills? There are all sorts of reasons the bank might want a co-signer, and almost all of them would indicate that you should definitely not “help” this person out. The only “help” that you would be giving them is enabling them to get into a huge amount of debt with a payment they likely wouldn’t be able to pay. That’s not “helping” anybody.

If someone asks you to co-sign a loan, be polite about it, but just say no. If they ask you why, just say that you don’t co-sign loans and leave it at that. If they make a big deal about it, that’s their problem. Don’t get suckered into co-signing the loan if you think your friend will get mad at you if you don’t. If this is the case, you likely don’t have much of a relationship to begin with.

People Who Co-Sign Loans Aren’t Smart. was created by and is property of American Consumer News.

Business Week recently ran a story entitled “Prisoners of Debt” in which they reported that a group of banks, collection agencies and even credit bureaus were working together to undermine bankruptcy law. They found that Capital One, Bank of America, Chase, and Discover were all ignoring existing bankruptcy laws, whether by accident or on purpose, and selling debts illegally to collection agencies so that the collection agencies could go after you and try to collect the bankrupted debt. There was recently a court case in which a Chase lawyer testified to a judge that bankrupted debts are sold all the time in the industry.

The article in Business Week stated that the banks public relations arms said that these actions were an “unintentional mistake,” but let’s look at the facts. Multiple banks have neglected to wipe out people’s debt when they file for bankruptcy and then sell the debt off to a collection agency so they can collect the money. The credit bureaus then help by listing debts on your credit reports, even though they are not valid. There’s a clear financial gain for banks and debts and collectors to flaunt the law like this and since there’s been a clear pattern across a number of different companies with a large number of consumers who have filed bankruptcy, it’s very difficult for these banks to pass off these actions as an “unintentional mistake.”

If you’ve found yourself the victim of banks and debt collectors who are trying to collect bankrupted debts, contact the banks y phone and in writing and try to get them to update the status of your debts which are legally expired. If that fails, your best bet is to go back to the bankruptcy court where you filed and present the matter before the judge.

Bank of America, Capital One, Chase and Discover Caught Actively Working to Undermine Bankruptcy Laws. was created by and is property of American Consumer News.

Working in High School – If you work 10 or 15 hours a week during high school and save most of that money for college, you can easily wind up with $5,000 or $10,000 in a savings account before college even begins, it’s like you’re giving yourself a scholarship.

Making Scholarship Hunting a Summer Job During High-School – The summer between your junior and senior year is the time to go crazy with your college scholarship applications. If you spend the entire summer applying for scholarships, working on applications for 20 or 30 hours a week, you can easily make more than enough scholarship money to pay for school. You’ll apply for hundreds of grants and scholarships and get rejected for most of them, but many of them will say yes and help pay for your education!

Parents, Grandparents and Rich Uncles – Many students have their college education subsidized by a relative who has come out pretty well in life and can afford to help them pay for school. If you have a relative with a significant amount of money that likes you, it might not hurt to show them where you’re at financially, what college will cost, and the benefits of you going to college. If you’re going to do this, make sure to have your stuff down and make a persuasive case to your family member.

Fellowships – Many colleges and universities offer fellowships to undergraduate students which essentially allow students to go to school for free if they work for the university. For example the South Dakota Regential system pays for the tuition of students in their technology fellowship program who agree to work for 11 hours a week.

Working in College – Some students complain that they don’t have the time or the energy to work while they’re taking classes, but this is simply not the case. You’re in school for all of 15 hours a week and maybe doing homework for another 10 or 15 hours after that, leaving you plenty of time to have at least

Applying For Scholarships While in College – Don’t stop applying for scholarship after you get into college. There are plenty of scholarships which are available exclusively to juniors and seniors that are worth looking into.

Student Loans – Don’t casually borrow money to pay for your entire education, but if it takes a few thousand dollars in student loans to get through school, it’s probably worth it assuming that you can come out of college with a high-paying job afterwards that will take care of your debt. If you don’t have a clear career track ahead of you that will make you a significant amount of money, it’s probably a better idea to just not be in school than to borrow money to make it happen.

Financial Aid & Grants – There are all sorts of federal grants available to college students, especially if they don’t have parents to back them up financially. It’s always worth it to apply for financial aid even if you didn’t get any the previous year. You never know when a no-interest loan or a grant will show up!

Pick a Cheaper School – If you can’t afford the large tuition bill that a private college will provide you, there’s always the option of an public in-state school that won’t cost you anymore than $5,000 a year or $10,000 a year if you live on campus. If you absolutely have to, you can work nights and cash flow your education.

College is a very expensive five-figure proposition, but the money to pay for it is out there, you just need to reach out and grab it.

How to Pay for College (Even When it Costs $20,000 a Year). was created by and is property of American Consumer News.

In response to this fiasco, the Department of Education has come down hard. New rules in place prevent financial aid offices from taking any gifts greater than $10.00 from banks or other financial institutions. These include things such as gifts, cash, prizes, trips and the like. Financial aid offices will also have to put at least 3 preferred lenders on their student loan marketing material and tell their students why those preferred lenders were chosen.

A number of different colleges have taken individual actions to clean up their financial aid offices. For example, the financial aid directors of Columbia University and Johns Hopkins University have both been fired. Since colleges are under very close watch right now, chances are the financial aid offices will treat you a little bit better and make sure that you’re getting a good deal.

If you’re going to apply for a Federal Stafford Loan, make sure to research the banks you’re choosing from thoroughly. Don’t just look at the 3 options your financial aid office will give you, look around online and see if you can’t get a better deal. Find one that won’t charge you an origination fee and one that will give you a discount for paying on your loan on time after you graduate. Make sure you’re going with a reputable bank that hasn’t had any string of complaints about how they treat their student loan holders. Do your due diligence to make sure you’re getting a high-quality and low-fee student loan.

Colleges Caught Red Handed Taking Kickbacks from Banks was created by and is property of American Consumer News.

“If I have a lot of money, I’ll have a good credit score.” Your credit score is not based on any wealth that you have what-so-ever. It’s completely based on your existing and past credit. 35% of your credit score is based on your past payment history, 30% is based on your existing debt, 15% is based on your length of credit history, 10% is based on new credit that you apply for and another 10% is based on the types of credit that you use. Hypothetically you could be a multi-millionaire and not have enough data to calculate a credit score if you never borrow money.

“If I check my credit report, my score will go down.” You can personally check your credit report as many times as you would like without having it effect affect you score. The one and only site to get a free credit report is AnnualCreditReport.com, if you want to find out your credit score, you’ll need to head on over to MyFico.com, all of the other sites wishing to provide you a free credit report will end up costing you money in the long run.

“I should pay off my credit cards and close them to increase my credit score.” Paying down your credit cards is an excellent idea to improve your credit score, but after the balance is paid off, do not under any means close the account. By closing the account you are essentially increasing the percentage of debt that you are using of all the debt that you have available to you, which will negatively affect your score.

“You only have one credit score.” You actually have three different credit scores from Transunion, Equifax, and Experian. Each of these companies might also have different types of scores for you. The one most commonly used by the financial industry is the FICO score; if you purchase your credit score, make sure that you are getting a FICO score rather than some other calculated number.

“If I shop around for loans, my credit score will be damaged.” It’s true that if you apply for a lot of new loans, credit cards and other accounts that your credit score will go down, but if you apply for the same type of loan at different banks and financial institution within 14 days of each other, it will only count as one application so your credit score will be very minimally affected.

“My spouse’s credit score will affect mine.” People tend to think that when they get married that there credit scores become one, but this is not the case. You still have individual credit scores, and whenever you both sign for something, say your home loan, it will appear on both of your reports. If only one of you signs for something, it will sign up on only the person who signed for it’s report and not their spouse.

6 Things Most People Get Wrong About Their Credit Scores was created by and is property of American Consumer News.

Does refinancing make sense? If you can eliminate at least one-half point off your current interest rate, it’s generally a good idea to do a mortgage refinance. Anything less than that, and it’s not really worth putting in the effort to go about home mortgage refinancing. If you’re planning on staying in your home for less than five years, you also need to calculate whether or not you’ll pay more in closing costs than you save in interest.

What kind of loan should I get? Always search for “zero cost” mortgage rates, which means you do not pay any closing costs when refinancing. By only looking at zero cost mortgages, you are giving yourself a perfectly clear point of comparison between your existing mortgage and what you can get on the open market, simplifying the process greatly. With a zero cost home mortgage, you’ll pay a bit higher interest rate, but you won’t pay any of the closing fees.

How do you find good interest rates? Not all mortgage companies are the same when it comes to the interest rate that you’ll be able receive. When refinancing your home mortgage, Your best bet is to head on over to bankrate.com, select the type of home mortgage you’re interested and look for the lowest rate. Make sure the mortgage company is on the up and up, and go for it.

What about points? A point is equivalent to 1% of the total amount of money that you borrow when refinancing your home mortgage. The idea is that if you pay a point up front, the lender will give you a slightly lower rate, but more often than not people don’t keep their mortgages long enough for discount points to pay off.

Should I roll over my other debts into my home mortgage when refinancing? A lot of people refinancing will receive offers to roll over their other debts onto their mortgage, or take additional cash out along with their home mortgage. Generally this is a bad idea because it will likely increase the interest rate that you’re paying. In addition, if you have an over-spending habit and just clear the balance of your credit cards, you’re likely to charge them back up again, and next time you won’t have the option of rolling the debt into your mortgage.

What about Home Equity Loans? Many people choose to move their home equity loans into their primary home mortgage when they go about refinancing. Rolling in home equity loans when refinancing can give you a better interest rate and better terms than you would have received with your home equity loan.

What else do I need? Always be sure to get a good faith estimate when refinancing your home mortgage. This is a listing of all of the fees and costs that you’ll be paying along with an estimation of the closing costs and estimated monthly payment. This way you won’t be hit with any surprises when the first payment comes.

Doing a mortgage refinance can save you a lot of money if you have the numbers down and know what you’re doing, but it can also get you into big trouble if it doesn’t make sense to do a mortgage refinance, so make sure refinancing makes financial sense before you dive in head first.

Mortgage Refinancing: When It Makes Sense, When It Doesn’t. was created by and is property of American Consumer News.