Category Archives: Credit Counseling

New Rules Support Credit Score Transparency

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New legislations may take the risk out of free credit score offers, which more often than not turn out to be bait-and-switch schemes.

A rule implemented last January required creditors to disclose the basis for setting loan terms, so that borrowers can see how their credit scores affected outcomes. For example, they can now see if their credit scores earned them higher or lower rates. Another law, set to be enforced on July 21, will further require lenders to provide free copies of credit scores to a wider range of applicants.

These rules were designed to improve transparency in lender decision-making, which has come under fire in the past few years as lending fraud and abuse became rampant. Poor lending practices are believed to have contributed to a large number of mortgage defaults and bankruptcies in the U.S., as borrowers, many of them newly unemployed, found themselves stuck with debts they could not afford. Despite their intentions, however, the laws risk raising more questions than there already are about obtaining free credit scores.

Part of the confusion comes from the misuse of the terms “credit score” and “credit report,” which are not interchangeable, according to John Ulzheimer of SmartCredit.com. Most consumers know that they can pull their own credit reports for free, but aren’t aware that scores are sold separately.

Some laws do allow for free credit scores. For example, the January rule mentioned above gives lenders two ways to satisfy the transparency requirements: to provide a copy of the score that influenced the decision,; and to issue a letter stating that the borrower’s credit risk resulted in less than ideal terms. The latter does not require lenders to issue the score itself.

The July regulation will change these terms by requiring lenders to disclose credit scores in all cases where borrowers are denied or given unfavorable rates due to their ratings.

The rules only apply to people who applied for credit or were denied it, so it does not guarantee a free credit score for everyone, according to Tom Quinn of Credit.com.

Experts also advise consumers to be careful when shopping for credit scores. Even credit bureaus themselves can be misleading; for example, Experian offers a “credit score for $1” that’s actually a teaser rate for a $15/month subscription, which automatically goes into effect unless it’s cancelled in a week’s time.

All credit bureaus—Experian, TransUnion and Equifax—offer a combined credit score and report for about $15. Fair Isaac, which developed the scoring system currently in use, also sells credit scores for about $20.

Is your Credit History Correct?

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It has been found that there are often mistakes on people’s credit history due to identity theft which happens quite often these days, as well as other mistakes such as it listing your old address or an incorrect address, your name being misspelled, or your old work listed as your current employment.  These may not have any bearing on your credit rating at all, but some things can, such as accounts being listed that do not belong to you.  This needs to be treated very seriously as it could be indicating that there has been some identity fraud in your name.  If you have a correct credit score/history, you can secure a same day cash advance in just 5 minute! My credit score is very important and yours is too.

Most people do not know a lot about credit reporting or scores.  There is also a lot of wrong information around talking about how to fix a credit report.  As a result of this research an experienced mortgage company decided to help people by creating a place you can go to find out your credit scores.  This is important if you would like to apply for a home loan as banks and lending institutions will check your credit history before approving you a home loan and mortgage on your new property.

Mike Clover is behind a website that can help you check your credit score and find further helpful information if you would like to check your credit report is correct.

What is Credit Counseling?

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Credit counseling is a good resort to manage various debts properly. Generally credit counseling is a professional counseling, provided by various organizations to help borrowers for repaying their debts properly. With the help of these organizations, people can manage their debts and lessen their burden.

Credit counseling helps people to overcome their debts burden. Their counseling enables borrowers to pay off their debts with smaller, monthly repayment that is convenient for everyone to pay. Especially credit counseling is required for those who are confused with various debts and different lenders.

These days, credit counseling services are easily available. Many companies provide this service. One can find out this service from his local communities and over the internet. For providing credit counseling service, some companies may charge fees or some organizations do not charge fees for their services. To manage debt problem properly, it is important to find a proper credit counseling service.

However, credit counseling is the best option for borrowers to prevent all sorts of debt damages. The way a credit counselor works is as follows:

•At first, a counselor evaluates a borrower’s condition and on the basis of that he makes a plan. And this plan helps the borrower to pay off his bills. Sometimes, legitimate counseling service can convince creditors to take less than borrowed amount and arrange a longer repayment period.

•In case of credit counseling, most of the time borrowers do not need to pay their bills directly. But, instead of that, in every month they make only payment to the credit counseling service and that amount is distributed among their creditors in accordance with the agreements they have arranged. All together, their arrangement will help borrowers to lessen their loan load and manage their debt properly.

As it is mentioned before that choosing a right credit counseling company is also important. With help of an unprofessional credit counseling company, a borrower can more get into debts, instead of coming out of it. Even more, such kind of unprofessional companies can misguide borrowers too. Therefore, individuals are advised to choose a credit counseling company wisely. In that case, one can take help of local associations of credit counseling companies. By making some efforts borrowers can make this service remunerative for themselves. Borrowers should check the reputation of various companies, duration of their service, and if possible they can try to get the opinion of their previous clients. At the same time, borrowers should bear in mind that at the time appointment with credit counseling company, it is better to present as much of their documentation and paperwork as possible, like proof of their expenditure, their income, the verification of their debts etc.

Credit counseling is offering borrowers a service that will help them to eliminate all confusion and complication regarding various debts and creditors. To manage debts properly and prevent monthly budget from unnecessary loan load, the necessity of credit counseling is unavoidable.



By: Alex Jonnes

About the Author:

By: Alex Jonnes

Article Directory: http://www.articledashboard.com

Alex Jonnes is associated with Easy Debt Consolidations. He is Masters in Business Administration and writes on various finance related topics.To find credit counselling, debt consolidation loans, debt consolidation with bad credit, easy debt consolidation UK at low interest rates visit www.easy-debt-consolidations.co.uk

For More Article Visit :: http://www.thearticleinsiders.com/



What Helps Can You Get From a Credit Counseling Service?

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Credit counseling services help people who are in debt to learn up the money management and reduce their debt in an effective manner. However, credit counseling is not a solution the fit every debtor. For people who are in heavy debt, credit counseling may not help to make enough progress to work your way out of debt. Who are the best candidates for credit counseling and what helps can you get from a credit counseling service if you approach them for help on your debt problem?

Although credit counseling is a common debt solution for debtors, it might not be a good option for every debtor. You need to understand the limitation of helps that can provide to people in debt and how these helps can really help you if you go for this approach. Credit counseling service will be a good option for you if your debt problem involves these situations:

1. You can’t make the minimum payments on your credit cards.

2. Always late in paying one or more bills.

3. Receiving harassing phone calls and home visits by collection agencies and your creditors.

4. You try to work out a payment plan with your creditors but unfortunately the creditors have rejected it.

When you approach a credit counseling service, the credit counseling agency will first assign a counselor to help you to examine your finances which include all your debts and incomes. You need to provide them the detail information about all your incomes, monthly expenses and debt repayment of each debt. From the information you provided, they will give you ideas on how to cut your unnecessary expenses so that you can allocate more money toward your debt. Besides that, they will also teach you how to better manage your money so that you won’t create more debt into your existing debt amount.

Depending on your debt situation, if you need a debt restructuring plan, the credit counselor will contact your creditors and try to negotiate with them a new repayment plan that meet your financial affordability. After going through a few negotiation processes, the creditors might agree to accept smaller monthly payment, waive or lower your debt interest, which is something better than nothing if you were to go into bankruptcy. Once you have agreed with the terms and conditions resulted from the negotiation which is agreed by your creditors, you need to follow the payment plan. You just need to make one payment to the credit counseling agency and they will help you to distribute the payment to your creditors.

After putting all your debt repayment in plan, you will also need to attend the debt and money management courses conducted by credit counseling agency. The key purpose of these courses is to teach you how to manage your money so that you won’t fall back to the same debt issue as you currently experiencing. Many debtors may be tempting to skip these courses because they are no longer being hounded by their creditors, but you should stick to it. You definitely do not want to trap into such a harassing debt issue anymore, and you can only enjoy total debt freedom if you know how to manage your income and expense. This financial education will teach the knowledge to stay out of debt, use of credit wisely and create a future financial plan that inline with your financial capability.

Summary

If you are the right candidate to get help from a credit counseling service, you can benefit from the service that helps you to learn how to manage your money and work your way out of debt.



By: Cornie Herring

About the Author:

Cornie Herring invites you to be debt free in 12 to 39 months and visit http://www.debt-consolidation-1stop.info to explore more information about debt relief options.



Facts you Should Know Before Considering Credit Counseling or Debt Consolidation

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

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

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

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

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

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

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

From the NPR article and the actions of the IRS, I think it’s fair to assume that many of these “non-profit” organizations have been operating under a scenario similar to that of a wolf guarding a hen house. However, this doesn’t mean all credit counseling and debt consolidation companies are bad but… you do need to know the truth about how they operate and their limitations.

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

One of the first actions these programs usually requires you to do is for you to CLOSE all your revolving credit accounts. You then make payments to the organization and they take care of everything for you. What this says to all your creditors (as well as anyone considering giving you credit) is that you are so out of control with your finances that you can’t even manage paying everyone back on your own. Therefore, you’re hiring someone else to do it for you!

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

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

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

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

If you care about your credit and want to benefit from it in the future, then you will never rely on a credit or debt counseling service to help you get out of any trouble you find yourself in. Instead, you’ll look inward and get yourself out while preserving your credit rating the best you can. Credit and debt counseling is for people who are “ok” with throwing their credit rating in the trash so they can have “someone else” manage their payments for them (since they are unable to manage them themselves). And again, as far as negotiating interest rates, you can do just as good as them or better. If you don’t believe me just call any of your creditors and straight out tell them your situation. You will quickly find you don’t need to be afraid of them. They just want to get paid like the rest of us.

www.Credit-Secrets-Bible.net



By: Jay Peters

About the Author:

Jay Peters is the founder of Consumer Publishing Group which publishes the Credit Secrets Bible (in print since 1994). To receive Free Credit Tips including “How to Bullet-Proof Yourself From Identity Theft For FREE!” visit their website: www.Credit-Secrets-Bible.net

© Copyright 2007 by Jay Peters



Credit Counseling For The Worried Debtor

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Although you try your best to keep our finances under control and pay our bills on time, there are times when you find yourself in unmanageable debt. If you’re experiencing slow or no payments on your credit cards, student loans, or car payments, credit counseling might be the answer you’re

looking for.

A credit counseling agency can help by finding ways to reduce and manage your debt. They do this by contacting each of your creditors to negotiate new repayment terms. Credit counselors

will also sit with you to review your budget and lifestyle to see if they can help by improving your spending habits and money management skills.

Finding a Credit Counseling Agency

Although there are many decent credit counseling agencies out there, scams and illegitimate companies do exist. You should avoid companies that claim to erase your debts or repair your credit in a short amount of time. It takes time to get credit card and other debts under control and repairing your credit can take several months to a few years. Watch out for agencies that charge high up-front fees.

Your best bet is to find a not-for-profit credit counseling agency or an agency that is accredited by a third party. Those agencies with accreditation must follow moral rules and quality standards.

Conduct a search online or use your phone book to find a credit counselor. Don’t be afraid to ask questions about fees, accreditation, or other concerns you may have.

Credit counseling agencies have certain criteria you must meet before you may enlist their help. Your debts must be at least a certain dollar amount, and other conditions may apply. The credit counselor will ask you a few questions to make sure that you qualify for their services.

Your Credit Report

Some individuals are concerned about their credit reports and what credit counseling can do to change it. Sometimes, your creditor may put a negative remark on your credit report for using the services of a credit counseling agency. This is because the agency will negotiate repayment terms, meaning that you haven’t kept your obligation to pay the amount in full, or with previously set interest rates.

However, this may be better missing payments or turning in late payments. Creditors report to credit agencies to mark these incidents, thus reducing your credit score. In the long run, it is best to get debt under control and pay them off. After that, you can work on slowly rebuilding your credit score.

What Happens After Using the Service of a Credit Counselor?

Your credit counseling agent will be able to help with personal finance education so you do not get into a sticky situation in the future. They will do so by discouraging credit card use and will show you ways to use credit wisely to rebuild your credit. Credit counseling agencies may also require you to cut up your credit cards to avoid such circumstances. Whichever solution you opt for, remember that a credit counselor has your best interest at heart.



By: Antonio Silver

About the Author:
Get the latest in credit counseling know how from the only true source at http://www.debtexpire.com. Check out our credit counseling pages.



Credit Counseling in Wisconsin

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Residents of Wisconsin have many reliable choices when they are seeking credit and debt counseling. By talking to an experienced, reputable counselor you will be armed to make the appropriate financial decisions to get out of debt.

When seeking credit counseling, you will want to make sure that you are talking to someone you trust. By choosing from a list of respected counseling agencies that serve in Wisconsin, you can know that the counselor on the phone with you can and will help you. Ask the questions you need to better understand your situation and what options are available to you.

The following agencies are available for credit counseling for Wisconsin residents. If you are in the Green Bay or Madison areas, call Vision Credit Education, Inc. to talk to a credit counselor about getting out of credit card debt. The Family Means Consumer Credit Counseling Service serves Eau Claire residents and provides them with credit help. CCCS of Beloit/Janesville, CCCS of Kenosha, CCCS of La Crosse, CCCS of Racine, and CCCS of West Bend all serve their respective cities.

Citizens in Burlington can talk to a credit counselor at CCCS of Western Racine County. The Catholic Charities Credit Counseling serves residents of Eau Claire, La Crosse, Prairie Du Chien, and Wausau. The CCCS of Greater Milwaukee serves Milwaukee and the surrounding area: Elkhorn, Waukesha, and Whitefish Bay. Family Service Association provides credit counseling for Fond Du Lac and Sheboygan. Residents of Green Bay, Manitowoc, Sturgeon Bay and Waupaca can talk to a credit counselor at Goodwill Industries. GreenPath Debt Solutions provide debt help in Greenfield, and LSS Financial Counseling Service is available for help in Superior. CCCS of Northeastern Wisconsin serves Wisconsin Rapids.

Credit counselors at any of the above credit agencies are able and willing to help you through your debt problems. They can go over a budget with you as well as discuss what options might be applicable in your situation. By answering your questions, they can help you come to an informed decision so that you can make the right choice when it comes to your financial future.



By: Ronnica Rothe

About the Author:

Ronnica Rothe is a graduate with honors from the University of Oklahoma and a current student at Southeastern Baptist Theological Seminary. She works with stopccdebt.com to help individuals get out of debt and reach their financial goals.



Credit Counseling – How To Get Out Of Debt

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If you’ve accumulated a large amount of debt, you’re probably going through stressful times right now. You may feel overwhelmed and uncertain about the future. Fortunately, there are solutions to your problems. Consumer credit counseling provides debt help when you find yourself in a financial bind. This type of debt solution helps with budgeting and debt repayment, and can help you avoid bankruptcy.

Most companies that offer debt relief and debt counseling carry everything out in a confidential manner, so you don’t have to worry about the privacy of your information and finances. Debt help through consumer credit counseling can be done through the Internet, telephone, or in person for a fee that almost anyone can afford. A debt solution doesn’t have to be expensive – this makes sense, as if you’re seeking out a debt solution you don’t have a lot of money to flush down the toilet on services that won’t help you out. Debt relief through debt counseling is usually the best route to take, especially if you have no idea how to go about the process on your own.

There are numerous consumer credit counseling agencies currently operating, so it can sometimes be difficult to wade through all the options. However, having many options available to you is a good thing – you should be able to find debt help that will make your life easier and lessen the financial burden.

Companies that offer debt solutions to their clients work to lessen your debt by communicating with major creditors to get rid of or reduce your interest charges, eliminate late payment fees, lower monthly payments, educate you on how to better manage your money, and come up with a suitable debt repayment plan that works for both parties.

Why do creditors allow consumer credit counseling when it doesn’t seem to be in their best interests? In the end, if you have to declare bankruptcy, and don’t have the means to pay any of your debt back, this is not good for the creditor. They would rather work out an arrangement and find a way for you to pay most of your original debt back, than force you to pay more and more interest and never come out of the hole. Creditors are slightly more flexible than you may think when it comes to helping people achieve debt relief because it does interest them in many ways to ensure that the people to whom they have lent money will be able to pay it back at some point in time.

Debt counseling usually means you won’t have to file a Chapter 7 liquidation bankruptcy to get out of debt, in which cases unsecured creditors don’t get any piece of the pie. You can see why if you need debt help, approaching a debt counseling company may be the best and only solution for you, especially if you’ve gotten yourself into a lot of trouble with debt.

You’re probably wondering right now, does this type of debt solution affect a person’s credit? It can, but if you make a few regular payments to the debt relief agency and show that you are taking some responsibility and can be trusted again, your debt reduction counselor will try to talk to all your creditors and negotiate to have the accounts re-aged, which means the status will be updated on all your accounts – this should improve your credit. It’s not easy to eliminate debt, but if you work with a counselor to get out of debt and make debt reduction a priority in your life, you can achieve your dream of being entirely debt free. It’s not going to be easy, but it will definitely be worthwhile in the end. If you want to start the process and eliminate debt from your life, credit help through a counseling agency is the easiest way to work with creditors and find a solution. It’s almost impossible to negotiate with creditors on your own – this is why counselors exist. They talk to creditors on your behalf and get you the credit help you’ve been seeking for a long time.

If you can get your credit rating back to its original status, nothing will hold you back in life. You’ll be able to do the things you want without coming up against unnecessary roadblocks, such as apply for apartments or a mortgage, and move on with your life. If debt is dragging you down and you’re starting to feel the stress, visit a local credit counselor and get the ball rolling toward financial



By: Garry Neale

About the Author:
To learn more about Getting Out of Debt, check out the Credit Counseling Web Site.