Tag Archives: debt elimination

Consolidate Bills-getting Rid Of Your Debt With A Plan And A Little Discipline





When you decide to make any type of life change, following a plan will help to ease the anxiety and stress that comes with it. With a plan you will need to discipline yourself. When it comes time to consolidate bills, make no mistake, this is a life change, and it will require discipline and a plan. When you have come to the decision that you need to consolidate bills, it’s not so that you can free yourself to run them up again. It is so that you can get your debts paid off as painlessly as possible and then not run them up again.

A plan will help you to get through this time of change. You will have to take some time to think about how you spend money, what you can afford to do without, and why you are consolidating bills. As you spend money in the next month or so, take note of everything that you spend money on. At the end of the month, review that spending and decide where you can afford to make cuts. When you consolidate bills you will free up more money each month, but you’ll want to use that money to pay off those debts, as well as use more cash, checks, or a debit card rather than a credit card.

Discipline will be necessary in this time of change. When you go shopping, decide whether you really need it or not. That will start you on your path to saving money. The next time a new blockbuster comes to the movie theater, wait until it comes on video. The popcorn is much less expensive in your living room and the setting much more intimate, and no screaming kids or loud teenagers. Seek out and use coupons whenever possible. Above all, when spending, do not use credit cards unless necessary.

No one sets out to gather so much debt that they cannot pay it off. Most of us go in with the intention of always being able to pay the bills, but sometimes those bills get alarmingly high. At that time, with a little discipline and consolidating bills, you can again get the best of your finances. Once that control is again in your hands, it’s more important that you learn to keep the newfound control. That is again where the discipline comes in. It is one thing to get yourself out of trouble once through discipline and the decision to consolidate bills, it’s quite another to keep that control by learning to spend wisely.

Are New Bankruptcy Laws Going To Help You?

There are 2 sides to the changes in bankruptcy rules. It will be a lot harder to file bankruptcy under chapter 7 and get a totally clean slate.

For businesses, relying on issuing credit, the new personal bankruptcy law is doing great, reducing personal bankruptcy claims from the thousands to double digits. (In the short run).

However, lawyers working with the actual people filing for bankruptcy say that the new law is seriously flawed because it puts more financial burdens on already broke clients and reduces potential debt repayment to small businesses.

And then of course you have the credit card companies charging high interest rates which in quite a few cases caused the bankruptcy in the first place.

According to some financial specialists, much of the debt people accumulate is a result of keeping up with the Joneses and not thinking ahead.

For 80% of clients counseled each month, the debt is credit card related and averages $32,000 – a result of six to eight cards. Consumer credit organizations say the new law provides debt-reducing strategies for those considering filing bankruptcy and curbs abuse.

Under the new law it has become a requirement that the person filing bankruptcy obtains credit counseling both before and after filing for which that person will be charged.

So now the consumer would then know the advantages and disadvantages of declaring bankruptcy. Yet it seems merely another expense for an already financially stressed individual.

People filing bankruptcy in general are not over spenders, but merely faced with temporary financial disasters such as medical costs, layoffs, a divorce, gambling debts or other crises. Before you can file bankruptcy, you are now required to complete credit counseling with an agency approved by the U.S. Trustees office.

This credit counseling is designed to help you determine whether bankruptcy is appropriate.

Once you complete your bankruptcy, the law requires you to attend another credit counseling session.

These are new requirements, before this law was passed the law did not require a person to go through counseling either before or after the filing of bankruptcy.

Second, under the old law, a person could decide to file under Chapter 7 or Chapter 13. Under the new law, the court will look at your monthly income and apply a means test relating to the state in which you live. If your income is less than or equal to the medium income, then you will be allowed to file Chapter 7 which in effect will give you a clean slate.

This medium income can vary from $28,000 in Missouri to $56,000 in Alaska. If your income is greater, you may be forced to file Chapter 13 unless you can demonstrate you do not have enough disposable income.

Under Chapter 13 you will not get a clean slate but will have to make payments on your debts.

Also, your attorney now must personally certify that your bankruptcy filing is accurate. This means more work for the attorney, with higher legal fees.

Advantages of declaring Bankruptcy:

Legal protection from creditors

Takes care of all or most debt

In some cases, can keep home and car

May stop complete financial ruin

Provides a fresh start

Disadvantages of declaring Bankruptcy:

Bad credit

May have to repay partial debt load and return collateral to creditors

May lose assets, including house and car (If the house is worth more than a certain amount).

Bankruptcy becomes public record, and

Remains on credit record for seven to 10 years

In the past, a bankruptcy offered a fresh start for the filer, said Columbia attorney Gwen Froeschner Hart. The new federal legislation offers language directed at helping creditors.

If you analyze credit card expenses for most people, you’ll see that they often include medical bills and day-to-day expenses for the elderly or those earning low or fixed incomes. Records show that 50% of credit card holders do not pay their full credit card bills every month.

33% of the population can’t afford medical insurance so have to charge their prescription drugs.

With the recent Medicaid cuts and rigid bankruptcy legislation who knows what is going to happen to these people.

There are some who say consumers are abusing creditors. The irony is that credit card companies are begging for customers and offering large amounts of unsecured credit, yet at the same time, lobbying for stricter debt controls.

bankruptcy guide

People view bankruptcy as a wakeup call and well they should because that means they hit the bottom of the barrel and are now scratching the bottom – for more cash! If you believe misery loves company, be secure in the knowledge that there are at least 1.5 million people in there with you, that is how many filed for bankruptcy in the last year. Anyone can over-extend themselves and many do for more reasons than I could count.

  Filing for bankruptcy is not only used by the lower and middle class but the rich as well. Famous people have fallen into the hole and climbed out, people like:

Donald Trump, Filed in 1990 – Kim Basinger, in 1993 – Burt Reynolds, in 1996 Rembrandt, in 1656.  I am not sure about the last one; he may still be trying to dig his way out!

 In the old days they would send people to debtors’ prison or even put them to death (not in America though), treating them like criminals. In these more civilized times, the government not only banned this kind of barbaric action but made into law rules to protect us.

 The bankruptcy code, also known by title 2 of the United States code (11 U.S.C.,101-1330),  has been put into place to protect the rights of the individual and corporations, giving them  a fighting chance against dept collectors, bankruptcy courts having the final word. There are basically two kinds of dept, secured an unsecured. Secured is where the creditor has collateral, be it your car, boat, house, or any material thing of value that they can take possession of if the dept is not paid. Unsecured is simply just the opposite, where the creditor has no collateral at all. In this case if the dept is not paid all they can do is use a collection agency where they call you day and night. Also, you must watch out with an unsecured dept because if the balance is large enough the creditor can put a lean on your property by getting a court order. This will prevent anyone from selling their house and moving away to hide from creditors.

  If you or anyone you know is behind on payments, there is something they should know. Since 1997 the government stepped in to stop dept collectors and collection agencies from harassing and threatening people in the middle of the night and using unethical collection practices. The Fair Dept Collection Practices Act (FDCPA) makes collections agencies follow certain guidelines. These are things collectors must do:

*Stop contacting you if the request is in writing and you dispute the dept in writing.

*Within 5 days of their first contact they must send you a letter stating the outstanding dept and creditor.

*If you want to dispute all or part of the dept the collection agency must stop contacting you until the creditor responds to your inquiry.

*If the collection agency wants to take you to court for the dept owed on behalf of the creditor it should summon you to the county where you now live or where you first singed the contract.

  Now, do not be alarmed just because a creditor threatens to sue you because most times it is just meant to scare people into paying on depts.

 Under the act (FDCPA) there are many things collection agencies cannot do, some of which are:

*No calling you at work

*Indicating they may be working with the federal government

*No calling your friends or family

*Implying that you may go to jail, garnish your paychecks unless the dept holder plans to do it

  Our government, in its infinite wisdom reasoned a long time ago that if they send everyone to jail there is zero change of collecting on any dept on behalf of a creditor.  You probably have heard of someone that has had their wages garnished, that is creditors who get a court order to take a piece of their check until the dept is paid. This is a common practice in states that allow wage garnishment and there is little you can do about it except for contacting an attorney. Did you know if you have an unpaid school loan or owe the IRS, they don’t even need a court order to garnish wages, even in states that normally don’t allow this?  You can bet on it; they can also take your tax refunds!

As for personal property, in cases like a store dept (store credit card, personal check or payment plan) on an item like major appliances or furniture you may have bought they still need a court order to take it back, unless you let them in anyway. That is right!  If you let them in without a court order they can come and get it back!  Many times, if is just not worth it for them to re-possess items because they must go the process of getting a court order and pay someone to carry it out. Also, it may be harder to sell a used item that may be stained or damaged. One final word on this point, remember on secured loans and cars there is a definite risk of repossession if the loan (mortgage or car finance) is not paid. There is usually too much money involved here for creditors to lose so these payments should be on top of you to pay list!

 If you find collectors are not playing by the rules you should call an attorney or the Federal Trade Commission’s response center at 1-877-382-4357 (FTC-HELP)

You can check out FDCPS’s website at http://www.ftc.gov/os/statutes/fdcpa/dcpact.htm for more info.

What Is Credit Card Debt Consolidation?

Credit cards are now the norms everyone uses it. They are the safest way to make payments to the sellers this method carries no risk of theft or anything else.

However, one must realize that with credit card shopping that you must make your payments on time and with the due amounts you cannot afford to miss one thing in this. One thing that can make payments of credit card debts easier that is credit card debt consolidation.

Being in debt is like being in a mess you have no control everything looks out of order and if you are in debts by the means of credit cards then the situation is even more difficult to handle. Creditors to whom we owe to keep making derogatory phone calls all the time and there seems to be no way out.

If you are looking for a way out, then the best one would be through credit card debt consolidation loan. By taking a credit card debt consolidation loan all the debts that you have taken will be consolidated into one from single creditor, which can then serve you with the following benefits:

It is easier to pay to a single creditor than to pay to multiple creditors.

While you pay to the multiple creditors you have to be totally on the mark making sure that every creditor is paid on time and the due amount otherwise you get a fine with credit card debt consolidation you can avoid that.

Your new creditor will offer you terms to your liking, which would include lower interest rates and lower monthly installments.

With credit card debt consolidation, you would not have to interact with your old creditors, therefore those annoying and disturbing phone calls would be stopped.

If you are a person who does not have a good credit score and you are also caught up in the credit card debts then you can also use the credit card debt consolidation all you need to know is your credit score.

Credit card debt consolidation is available in both secured and unsecured forms i.e. with or without a security to the borrowers; depending upon their affordability they can choose the option best suited to them. You can apply for these loans either by going online or by applying to your local creditors subject to the requirements the loan will be approved in a reasonable time.

Debts can accrue on anyone but what we must make sure about is that they do not get out of control and their adverse effect is not intensified. Credit card debt consolidation has been introduced so that people can use them to eliminate their debts.

3 Types Of Debt Help Available Online – Consolidation Loans, Debt Management And Debt Settlement

When it comes to consolidating debt, the internet offers three very good options. When you want to choose between a consolidation loan, debt management, or debt settlement, it is important to have an understanding of each one so you can choose the option that is best for your needs. Many people confuse these three services, but each one brings unique aspects to the job of helping consumers pay off their debts.

Debt Consolidation Loan

A consolidation loan takes all of your high interest credit card debts and turns them into one low interest loan. Often you have to be a home owner to qualify for this type of loan. The idea behind a consolidation loan is that with a lower interest rate, you will actually be able to afford to pay on the principle and that will help you to eventually get yourself out of debt.

Debt Management

Debt management companies work with consumers to help them learn to get control of their finances. The companies teach individuals how to make a budget and stick to it and often help them make a schedule to follow for paying off their debts. Most debt management companies are non profit and exist solely to help consumers get on track. These companies don’t offer loans or negotiations and seldom work with creditors. Instead they work with you so you will have the tools to secure your financial future.

Debt Settlement

Debt settlement companies actually go to your creditors on your behalf. The work hard to negotiate with credit card companies to reduce what you actually owe. They can often lower interest rates, have penalties and late payment fees removed, and even get credit card companies to lower the balance of what you owe. Many of them will set up a system where you pay them one amount each month and then they in turn make payments to your credit card companies.

When it comes to consolidating debt, the internet offers three very good options. When you want to choose between a consolidation loan, debt management, or debt settlement, it is important to have an understanding of each one so you can choose the option that is best for your needs. Many people confuse these three services, but each one brings unique aspects to the job of helping consumers pay off their debts.

Debt Consolidation Loan

A consolidation loan takes all of you.