If you owe a lot of money to a few credit card companies and can’t pay it off so fast, there are still some steps you could take to protect yourself.

Make an effort to pay off your credit cards as soon as possible.  Cut back on expenses and luxuries so you have extra cash to pay off your credit cards.  stop using your credit cards to live beyond your means and start paying them off.  Stop using the card and start paying it off.

Prevent them from claiming they received a late payment.  All the major credit card companies gain profits from collecting late fees, so they have a reason to trick you into paying later. They love to prey on customers who carry big balances. A common tactic is to move your due date and hope you won’t notice.  And despite the fact that their paying processing centers operate 24 hours a day, seven day a week, most credit card companies won’t post payments received after 1:00 p.m. or on weekends. 

You can sidestep this trick by always examining the due date when your statement arrives and paying your bill electronically.  Your bank probably offers an electronic bill paying service (make sure it’s free), you can also make payment directly at many credit card websites. At the time this article is being written, you can pay Citibank, MBNA, Capital One, Bank of America and hundreds of other creditors via Paypal just by clicking a button, and it costs you nothing.  All you have to do is register with Paypal, confirm your bank account and you’re set to go.  When you pay electronically, you have an electronic receipt indicating the date the payment was sent and received as proof that the payment was made on time. 

Put all billing disputes in writing.  Credit card companies want to communicate with you exclusively by telephone so they can deny receiving your call later on, if necessary. Even if you write them a letter, they will respond by phone.  If you have a dispute with them, it is very important that you don’t call them, instead, put it in writing and send it certified mail, return receipt requested and request that they communicate with you only by letter.  You need the written proof to fight them.  Those who fight them with letters often get late fees and such removed.  

Pay all of your bills on time. Some of the major credit card issuers monitor your credit report for negative activity. If they find late payment notations or written off accounts, etc., they will boost your interest rate dramatically.  Almost all of the major credit card companies use this tactic — they raise people’s rates from 7% to 28% just like that when they find a late payment or a high debt ratio on a credit report!  If you don’t want your interest rate quadrupled, keep your credit score high, pay your bills on time, and don’t accumulate too much debt.

Don’t just pay the minimum due each month.  If you have a large balance and pay only the minimum on a credit card for many months in a row, some banks will raise your interest rate significantly.  Try to pay at least $30 more than the minimum each month to avoid their wrath.  Even if you’re struggling with debt, it would be a good idea to make a few large lump sum payments at least twice a year to indicate that you do have some cash to pay down the debt — send them at least three or four times more than the minimum required.

A warning to those struggling with debt — Most debt counselors recommend that you focus on paying off one credit card at a time.  They advise you to apply all your extra cash to one credit card while paying only the minimum due on all other credit cards.  But this can have very serious consequences if those companies to whom you are paying only the minimum raise your interest rate because you have been paying only the minimum for a very long time.  If your rate is raised from 15% to 28%, it’s going to take you so much longer to pay off that credit card.  

A better alternative is to pay down all the cards at once by sending in at least $10 more than the minimum due each month, but ideally, at least $30 more than the minimum due each month on each credit card to keep your rate from being increased.  And, if you have any extra cash left over after that, you can use it to concentrate on paying off a specific credit card. 

Complain, complain, complain.  Credit card companies get away with all of the above because too few consumers complain to their state and federal elected officials.  If your senator received hundreds of letters from consumers threatening to vote him out of office in the next election if he doesn’t stop taking money from the banking industry and enact regulating legislation as soon as possible, you can be sure he would do something to keep his job and his fat salary and benefits.  Links are below.

When will this madness stop?

Just to recap, let’s look at how much we have already spent in little over one year under a Congress lead by Nancy Pelosi and Harry Reid.

$141 billion in TARP funds (if Barack Obama decides he would like to spend the $200 billion dollars of TARP money that has been leftover—as he has indicated that he would like to do—the actual cost would increase to $341 billion … so much for trying to reduce the national debt)

$30 billion to bailout auto manufacturers

$410 billion for the first omnibus spending bill of 2009

$787 billion for the Obama stimulus (some economists put the potential 10 year cost of this stimulus at $3.27 trillion)

$3 billion for “cash for clunkers” (or $24,000 per car)

And there’s more to come. If Congress passes health care reform, it will likely cost taxpayers at leastanother $849 billion.

The amount of spending going on in Washington is staggering. So much so that it is easy to become numb to another $100 billion here or another $1 trillion there. But we must remember all of this spending will have consequences. Even if all of this spending provides a short term boost to our economy, it will almost certainly have long term consequences that will be disastrous—at least for our children and grandchildren, who will be stuck paying our tab.

With our elected officials in Washington again asleep at the wheel, it is up to the American people to alter the course of the nation before we are all driven off of a cliff. Buckle up for a bumpy ride.

source: http://www.examiner.com/x-28541-Kissimmee-Conservative-Examiner~y2009m12d13-Runaway-spending-continues-as-Congress-raises-debt-ceiling-to-almost-14-trillion

Most Americans agree, credit cards tempt them to buy more.  83% of adults said that credit cards tempt people to buy things they can’t afford according to a Rasmussen reports national telephone survey.  8% disagreed with this and another 9% were not so sure.

The results that the telephone survey found are similar to the results found last holiday shopping season.

20% of adults say they don’t have credit cards, down 5 points from last year. 23% say they have only one credit card, while another 19% say they have two. Just over one year ago, 34% reported having either one or two credit cards.

36% of adults report having at least three credit cards, and 18% say they have more than three. At the end of last year, 38% said they had at least three cards.

82% woman compared to 73% men report having at least one credit card. 1/4 men do not have credit cards.

Americans may be opting to hold fewer credit cards these days since 50% say interest rates on their cards have been raised in the past six months, as Congress seeks to limit the ability of banks to raise those rates.

24% of Americans also say they need to cut back on using their credit cards.

57% of Americans say there is a need for better government oversight of the credit card industry.

A poll that came from AARP said that the older generation will spend around the same amount this Christmas as they did last year.

Of those 65-plus, nearly half (45 percent) say they’ll spend less than $300

“We shop every week and buy gifts all year long,” says Fowler, who retired from IBM in 1990. “We don’t wait till the season. It’s easier, and we get as good a deal as ever because we shop while the stores have sales.”

Most people seem to want to avoid racking up debt this holiday season. More than three-quarters (78 percent) say they plan to buy their gifts with cash, check or a debit card.

Fowler, who lives on Social Security and his pension income, says he always pays cash for holiday gifts. “That’s the way I’ve always been, since the 1950s,” he says. “We don’t have any credit card debt.” – AARP

From these results, there is a lesson to be learned.  We should spend less money on gifts and more time with the ones we love.  We should experience a debt free holiday every year.  We should not wait until the end of the year to shop for Christmas and we shouldn’t use credit cards.

Before you consider filing for bankruptcy, it is important you understand the difference between different types of bankruptcy and your reasons for filing.  Credit rating is affected and much legality is involved.

Full freedom from the debt is not easy nowadays as the changing laws are getting tougher. Federal laws are supplemented by additional laws in many states.

If you are filing for bankruptcy, you can be affected by two main chapters of bankruptcy, Chapter 7 and 13.  Both of these chapters of bankruptcy are common and take into account individual debtors and small filers.

Chapter 7 also known as liquidation frees the debtor from all requirements to repay debt and may result in liquidation of assets.  More commonly, the debtors assets are exempt from the process of liquidation.  Fraud-related loans, student loans debt, State and federal debts may not be discharged through this process.

Chapter 13 is for the restructuring of debt and is commonly known as Reorganization. A repayment plan can be worked out by the debtor and creditor on the basis of approval from the court regarding the payment of the debt.

On the other hand, Chapter 13 an attempt to liquidate assets for the payment of complete debt amount. In order to make part payment of the main debt, re-structuring of payment plans is done more often. You can clear all your debts in less than five years.

Legal and Filing fees: Fees is approximately $800 or may be higher for a single person. Couple fees and business owner fees is $1,000 or more. You have to keep all the paperwork up to date to help your attorney in filing your documents. You will also have to spend time reviewing bills and answering questions to your attorney.

Did you know that certain types of debt and financial obligations cannot be discharged when filing for bankruptcy?  There are debts that are exempt from bankruptcy laws and you need to pay them whether or not you file for bankruptcy protection.

One financial obligation that can’t be discharged through bankruptcy is child support.  You are required to pay for child support by court order and filing for bankruptcy does not mean that you can stop paying it.

An IRS lien is expempt from being discharged by bankruptcy. What happens with an IRS lien is that you owe income tax payments from one or multiple years. At a certain amount of money owed, the IRS will put a lien on your house or some other type of asset that you own, or in lieu of that possibility, may garnish your wages via your employer. This type of IRS lien, in addition to being exempt from a bankruptcy discharge, is also on your credit report for about 10 years as a huge blemish, which would be in addition to the blemish on your credit report from your bankruptcy filing. These types of red flags on your credit report can make it more difficult to get approved for new credit in the future.

A court order, which may have awarded an individual or company a specific amount ofmoney through a lawsuit brought against you is not a debt exempt from bankruptcy either.

If you are behind in one or more debts with your creditors, those creditors will commonly file a lawsuit against you eventually.  This takes time and most creditors are not quick to go to this extreme to collect their money but in time it will most likely happen.  If this type of lawsuit occurs before bankruptcy, it will not be discharged after bankruptcy is filed.  If you have creditors with a judgment against you, filing for bankruptcy may not do much for you.

Government loans such as federal student loans are also exempt from bankruptcy discharge.

WASHINGTON – The stress from deepening debt is becoming a major pain in the neck — and the back and the head and the stomach — for millions of Americans.

When people are dealing with mountains of debt, they’re much more likely to report health problems, too, according to an Associated Press-AOL Health poll. And not just little stuff; this means ulcers, severe depression, even heart attacks.

Take Edward Driscoll, 38, of Braintree, Mass. He blames debt — $10,000 worth — for contributing to his ulcers and his wife Kimberly’s panic attacks. “Just worrying, worrying, worrying, you know, where the next payment of this is going to come from,” he says.

Although most people appear to be managing their debts all right, perhaps 10 million to 16 million are “suffering terribly due to their debts, and their health is likely to be negatively impacted,” says Paul J. Lavrakas, a research psychologist and AP consultant who analyzed the results of the survey. Those are people who reported high levels of debt stress and suffered from at least three stress-related illnesses, he says.

That finding is supported by medical research that has linked chronic stress to a wide range of ailments.

And the current tough economic times and rising costs of living seem to be leading to increasing debt stress, 14 percent higher this year than in 2004, according to an index tied to the AP-AOL survey.

Among the people reporting high debt stress in the new poll:

• 27 percent had ulcers or digestive tract problems, compared with 8 percent of those with low levels of debt stress.
• 44 percent had migraines or other headaches, compared with 15 percent.
• 29 percent suffered severe anxiety, compared with 4 percent.
• 23 percent had severe depression, compared with 4 percent.
• 6 percent reported heart attacks, double the rate for those with low debt stress.
• More than half, 51 percent, had muscle tension, including pain in the lower back. That compared with 31 percent of those with low levels of debt stress.

People who reported high stress also were much more likely to have trouble concentrating and sleeping and were more prone to getting upset for no good reason.

When their construction business went under four years ago, Pamela Crouch, 61, and her husband, who had retired from General Motors, found themselves struggling under IOUs totaling $30,000.

“We just kind of felt desperate. We just really didn’t have enough to live on to pay what we had to pay,” recalls Crouch of Eaton, Ind. She remembers having trouble sleeping and concentrating. “We ended up paying a lot of our bills just on the credit card,” says Crouch, a medical assistant in a nursing home. “We were stressed and depressed. … It was really rough.”

Their son, a manager of a construction supply company, recently helped them out with their debt problems. “Things are doing much better,” she says. “It made a world of difference in how we feel.”

‘Fight-or-flight’
It isn’t known for certain whether such stress is causing health problems, says Lavrakas, who while at Ohio State University in the late 1990s helped to develop an index to measure the extent to which people are stressed from financial debts.

Source – http://www.msnbc.msn.com/id/25060719/

Spending less during the holiday season does not mean you will have less fun.  Make sure you plan an affordable holiday.

Create a holiday budget.  A spending plan is a good start for a cheaper holiday season.  Don’t forget to include the cost of decorations, food and gifts into your budget.

Make a gift list and don’t go over your spending limit.  Get your gift ideas down on paper before heading out to the shop.

You don’t have to spend a lot to give a nice gift either.  Remember what your budget is while shopping.

Shop at thrift stores, yard sales and flea markets or other second hand sources for gifts.  Maybe you know someone that likes vintage jewelry or antiques and you can find these things for cheaper at a second hand shop.

Make sure you don’t end up shopping for yourself on top of the other people you are shopping for.  You will end up with less stuff and more money in the bank.

Make your own cards.  The cost of holiday cards is really expensive plus you have to pay for postage.  You can also wrap your own gifts.  In store gift wrapping sometimes increases the cost of each gift by another couple of dollars.

It’s the holiday season, the biggest shopping season of the whole year.  It’s this time that many Americans end up with thousands of dollars in credit card debt they cant afford to pay back.  Here are some reasons to avoid using your credit card while shopping for the holidays.

If you have a debt on your credit card now, you will only be adding to it.  You will spend more money with a credit card because there is no physical sign telling you to stop spending.  Try to avoid using your credit card and use some cash you have put aside for holiday shopping.  You will pay more with a credit card as well because you pay interest on balances that you carry for more than a month.  Also, if you already had a balance on your card, you won’t get a grace period.  Interest will start adding up quickly.  The New Year will come and you will be paying off debt from the holiday season.  During the holiday season, there is also a much higher risk of credit card fraud.  Leave your credit card at home and reduce the risk of someone stealing your card while shopping.  In February 2010, a credit card rule will stop credit card companies from raising rates on already existing balances.  Banks still have around 60 days once holiday shopping ends to raise your rates before the new rules take effect.  You could be paying much more than you expected.  You could be spending more than you can afford.  When holiday shopping, it is difficult to keep a tab of what you are buying.

Many people willmax out their credit cards while holiday shopping.  You are now risking going over your credit limit once the finance charges kick in.  When a balance is over 10% to 20% of your credit limit, it has a negative impact on your credit score.

Buying more gifts than you can afford will only cause trouble for you in the near future.

Do not go shopping without a budget.  Going shopping without a limit will make it very easy to charge more than you can afford.  Before leaving your house to go shopping, you should figure out exactly how much you can afford to spend.

Once a budget is made, make sure to keep up with it.  Keep all of your receipts and check your account to make sure you are not spending too much every now and than.

Many are guilty of opening a new account just to get discounts.  Plenty of retail shops try to convince their customers to sign up for the store credit cards for better discounts on purchases.  You will be risking charging more than you can afford, in return affecting your credit score.

Never let someone else go holiday shopping with your credit card.  You won’t have any idea how much they are spending and if your card borrower does not pay, you will have to have extra money to pay for their balance.

Be careful not to leave your card somewhere while shopping.  Your credit card is targeted this time of the year more than ever.  Never let your cards get out of your sight.

If you are using your credit card to buy gifts because you don’t have cash chances are you can’t really afford the gifts anyway. If you don’t have money for gifts, don’t resort to credit. Instead, consider regifting items you’ve received or give homemade gifts.

Charging gifts for yourself because you “deserve” them.  It can be hard walking around the stores for weeks without getting anything for yourself. You’re going to see things you want to buy, but practice some self-discipline. Remember that while you’re out getting gifts for others, there are people out buying gifts for you.

Ignoring your post-holiday billing statement.  If you kept track of how much you spent, you can already guess that your first credit card billing statement will be higher than normal. Facing it sooner rather than later will help you get rid of that high balance sooner rather than later.

By turning your thermostat down three degrees, you can save around 3% on your heating bills.  Make sure it is off when you are at work and turn it down even lower when you are sleeping to save even more money.  Shut the doors to any rooms that aren’t being used to conserve energy.  Weatherstripping doors and windows can amount to using less heat.  An insulated attic can also reduce the cost of your heating bills.  The refrigerator, hot water heater and the heating system are three of the biggest energy consumers in your home.  To improve the efficiency of your appliances, Make sure you give your furnace a tune-up once a year.  Wrapping the water heater will insulate it and cleaning the refrigerator coils twice a year will also help improve their efficiency.  It is also possible that your utility company offers a reduced rate for certain times of the day.  If your schedule allows it, timing these devices to cycle during this period could greatly reduce the amount of energy being used.  A lower water bill can be obtainable if water leaks are fixed and water saving shower heads are installed.  By placing a heavy object in the toilet tank such as a brick, you will also be conserving the amount of water used.  Filling up the dishwasher and washing machine halfway and than running it costs the average American household $700 to $900 dollars in added utility fees each year.  Do full loads of dishes and laundry. Also when drying your clothes in groups one after another, your dryer saves energy because it is already hot.  Using e-mail and calling friends and family at night and on weekends can significantly lower your long distance phone bill.  See if there is a cheaper long distance package available.

These are just a few tips to help you save money on your utility expenses.  Feel free to share any other stories, ideas or practices you go about in your home.

Did you know that when you buy a new car, the value of the car immediately depreciates when you get it home? By buying a car that is one year old, you will be paying close to what the car is actually worth. Most cars are worth half their value within a two year period. Buying a car with a high residual value may allow you to sell or trade it in for more. A quick google search can help you find your cars residual value. Be cautious and check how much the vehicle costs to insure, even different models have different insurance rates. Maintaining your vehicle for around $50 can save you about $800 a year in repairs. Check your vehicles manual and follow its recommended maintenance schedule. Learning how to change your own oil, antifreeze and filters will save you even more money. Washing your own car can save you as much as $30 a month. Lastly, if you have things in your trunk or backseat, take them out. Items in your trunk or backseat add to the cost of fuel it takes to run your vehicle.

Help share your stories on how you save money on transportation costs. You never realize how often you might just say “why didn’t I think of that?”

People who know exactly how much they spend each month on groceries are twenty times less likely to be deep in debt than those who don’t know how much they have spent.  When we include dining out, vending machines and fast food into the list of food related purchases, we realize how much we are spending.  Prepackaged and ready to eat meals also end up costing a lot of money.  Eating is a necessity but there are many ways to noticeably reduce your food budget.

First of all, stop going out to eat.  Eating out is much more expensive than a meal that could have been prepared at home.  Do not buy frozen meals.  When you buy frozen food, you are spending way too much for way too little.  Try preparing your meals from scratch when you have some free time for the rest of the week.  Don’t buy meats that are already cut.  You are paying the supermarket to cut up the meat for you.  You can save a dollar per pound of meat by cutting it yourself.  You should of course make sure to compare supermarkets. One supermarkets may price items $1.00 $2.00 more or less than another supermarket.  Buy the generic brand products which are usually processed at the same plants as the name brand products.  When you buy a name brand product, much of the cost goes to the expensive of the product.  This can save you over $500.00 dollars in a year!  Buy fruits and vegetables when they are in season because the price will be significantly less.  Eating vegetarian meals once a week can save a family of four about $15.00 a week.  Use Coupons wisely. A lot of people use coupons just because they have one.