Performance Debt Resolution WebLog

Why You Can’t Trust Credit Card Companies: Feds Suing Big 3

Ok, for all you folks thinking you’re safe out there with credit cards and the deceptive practices of creditors, here’s one more example of how they put consumers deeper into debt.  And they like to keep it that way for obvious reasons.

The U.S. Justice Department and seven US states are suing Visa, Mastercard and American Express over anticompetitive practices.  The big 3 allegedly are attempting to make it difficult for merchants to reveal to customers lower cost ways to purchase merchandise.  Merchants were also restricted in their contracts to offer discounts or incentives to customers for different payment methods.  The government has indicated that credit card ‘processing & administrative’ fees have gone down over the years, however credit card companies continue to raise costs to merchants, who in turn have to raise costs to consumers.

Mastercard & Visa hurriedly entered into a settlement agreement to curtail the lawsuit.  The American Express case will proceed and their contracts are considered to be the most restricting to merchants.  A company representative indicated that the company has no intention on settling, and will fight the suits in court.

Among the states suing are CT, MD, IA, MO, OH & TX.

If you’ve been pinched by high credit card debt and want to get out of debt permanently, Performance Debt Resolution can help.  We offer a dispute-resolution program to guarantee a 60% reduction in your credit card debt. This is not debt settlement or debt consolidation. Don’t let creditors charge off your debt, resolve it with our attorney backed program.  Call today at (866) 401-6148 to see how we can help eliminate your debt permanently.

More information can be found by visiting www.reducemydebtquick.com

Credit Card Debt Collectors: Obscene, Harassing, & Racial Practices

We’ve talked before about the threatening and abusive practices that some credit card debt collection agencies use.  This story made abc headlines recently.  If you have the stomach for it, the entire video and transcript can be viewed HERE.

This time, it was a major creditor who hired this particular debt collection agency.  We don’t like mentioning names, but you’ll see who it was.

And don’t forget, the abusive practices were documented just a few months ago by the FTC.  Harassing credit card calls have been on the rise.  See HERE for a refresher.

The issue is that there is so much debt being written off & sold by credit card companies, abusive practices are on the rise.  Companies buying the debt are now on the hook to retrieve it, and they’re trying anything to collect, including breaking the law.

If you suspect abusive practices, report them to your local law enforcement.  The Federal Fair Debt Collection Practices Act protects consumers from violators.  Don’t be a victim, know the law.

Credit card companies, and debt collectors alike must adhere to strict rules when attempting to collect on a debt.  Typically, the original creditor sticks to the rules.  3rd party collection agencies are notorious for breaking the law, so be on the lookout.

If you would like to consider eliminating your total by 60% and get out of debt permanently, Performance Debt Resolution may be able to help.  Backed by attorneys using consumer protection laws themselves, your debt is disputed and resolved with your creditors.  And, unlike debt settlement or debt consolidation, you will enjoy the benefit of no taxes on reduced amounts.  For a free consultation, and a guaranteed result, call (866) 401-6148 to find out what Performance Debt can do for you!  Act now.  Don’t delay.  Start living debt free!

More information can be found by visiting www.reducemydebtquick.com

Student Loan Debt Now Higher Than Credit Card Debt

The latest reports are in.  Graduating students owe approximately $23,000 in student loan debt on average.  This translates into over $830 billion dollars in student loan debt nationally.  Compare that to the just over $825 billion in credit card debt and we have a winner!  Not really.

You see, any federally funded student loan debt cannot be wiped out in bankruptcy like credit card debt.  There’s no escaping it.  Uncle Sam can even ‘pinch’ some of your social security checks and any tax refunds to repay that debt.

With ever rising tuition costs, Americans are borrowing more, according to the numbers.  So much so, that i’ts virtually impossible to pay it all back, especially in this gloomy economy.  Historically, sutdent loan debt was always considered a safe bet, since the debt was going toward education and ultimately towards a higher paying career.  For some, this has turned out to be not so true.  Some grads are now struggling to find employment.  Also not helping is the fact that a college degree costs 5-6 times as much as it did only a couple decades ago.

Experts advise to take out private loans only when federally funded loans are not an option.  The benefits of government guaranteed loans outweigh the high interest rates that can occur with private loans.  If you do get funded with private loans, make sure they’re paid back as soon as possible.  You may even be eligible for tax breaks if you make timely payments consistently.  Also be aware that some lenders may reduce interest rates over time, once the graduate proves their track record.

Beyond this, if your struggling with student loan debt, and it’s not government backed, Performance Debt Resolution can help.  Just like credit card debt, student loan debt can be reduced by 60% with our attorneys.  The reduction is guaranteed and your monthly payments can be cut in half.  Also consider a debt management program, debt consolidation, or debt settlement.  Shop around though, as debt settlement causes a tax consequence for reduced amounts.  Debt consolidation loans, with their interest rates, may put you right back where you started.  Debt resolution can prevent taxes and get you out of debt fast.  Call (866) 401-6148 to find out what we can do for you today!

More information can be found by visiting www.reducemydebtquick.com

Check Your Credit Card Statement: Chase Site Plagued With Errors

Last week was a bad week for the credit card giant Chase.  Plagued with online services problems, their internet commerce site went down on Monday night September 13, 2010 and was out all day Tuesday the following day.

Chase reported that their site was available again on Wednesday for customer access but online users were greeted with more error messages, saying the site was again unavailable.  More than 16.5 million Chase customers use their online services.

Chase reports that they would work with customers who had payment deadlines during the outage.

Frustrated customers posted their displeasure using social media such as Twitter and Facebook.

It may be wise to thoroughly check your statement during that period and be on the lookout for any errant late fees or other charges.  Also make sure any payment(s) you did submit was cleared by your bank and on what date.  As we always post on our site, watch your statement like a hawk for any unanticipated activity, including erroneous fees and charges.  You never know what can turn up.

Meanwhile, if you need help with debt management or you are trying to get out of debt, seek assistance as soon as possible.  If you cannot meet your minimums, try a workout plan with your creditor.  For an even faster way to cut down debt permanently, consider debt resolution.  Our attorneys will help you dispute your debt legally and they guarantee a 60% reduction in your total credit card debt.  Do yourself a favor and seek the help you need.  Performance Debt Resolution is dedicated to helping you get out of debt with the honest answers you need. Contact us today for a free consultation at (866) 401-6148.

More information can be found by visiting www.reducemydebtquick.com

Debt Can Cause Personal Relationship Problems

Having large amounts of debt can cause many problems we all know.  We blog about it here all the time.  Debt affects credit score, your ability to get new loans, and even a new job.  What we haven’t talked about yet is the strain it puts on your personal relationships.

Sometimes the hidden debt isn’t even revealed to your spouse, or potential spouse for certain fears.  Once it comes out though, it could be detrimental.  Take the case of a young courting couple from San Francisco, CA.  You see the bride to be, Alison, told her fiancee early in the relationship that she had a pile of debt.  A little over $100,000 was what she estimated.  She didn’t actually know (or want to know) because she said the amount was just too depressing.  She focused on just paying the monthly payments to get by; $1,000 worth of monthly minimums to be exact.  Just before their big wedding day, Alison figured out that her actual total was nearly $170,000.  That was enough for her fiancee to end the engagement and cancel the wedding, accusing her would be wife of lying.  Poor Alison racked up a good amount of debt simply pursuing education for her professional career.

In another case Kerrie, an aspiring doctor, managed to accrue just over a quarter million dollars in debt during her academic career.  In this case her fiancee is not worried about the amount of debt, and has said it will work out over time.  For Miss Tidwell, she doesn’t feel guilty either as she was pursuing her passion; a career in medicine.

Still, for couples all across America, early disclosure seems to be key in working things out with a sound plan.  Even when some couples reveal their financial secrets, it still presents challenges.  Every decision they make hinges on the debt, from what home they might afford to whether they have children or not and how many.

If you’re strapped with what seems to be mountains of debt, consider a way out, especially before venturing into a new relationship.  Plan on starting over, if possible, with your financial profile before bringing any challenge into a new relationship.  Debt management, debt consolidation or debt resolution are all viable choices.  To get out of debt completely, consider a program that offers a one-time payment.  If you can afford it, it’s the quickest way out in some cases.  As always, do your homework, ask the right questions, and consider a program backed by an attorney.  You’ll be soon on your way to living debt free.

More information can be found by visiting www.reducemydebtquick.com

Source: NY Times

New Credit Card Laws STILL have Traps

Ok, so how are we all doing just a week after the new credit card laws went into effect?  Has anyone managed to get out of debt?  We didn’t think so either.  It’s a long climb to get out of debt.  Certainly just a week after new regulations went into effect is not enough time.  Hopefully though the new laws will make it easier.  Or will they?

Well, yes and no.  The ‘yes’ is that creditors have been restricted in terms of their fees.  No more outrageous late fees.  In fact experts say most people will now pay a $25 late fee instead of the usual $39 AND there should be fewer of them.  Another ‘yes’ is that creditors must re-evaluate your profile every 6 months after imposing any kind of ‘punishment’ increase in interest rate.  What that means is that you have time to get back on track after you clean up your act and enjoy your original interest rate again.

Ok, so what’s the ‘no’?  The ‘no’ is that of course there’s a huge loophole in this.  The loophole is that the Fed has refused to regulate the penalty rate on interest charges.  What?? Yeah, that’s right, if you don’t cure your late issue and pay on time for 6 months, you may wind up paying the higher rate forever.  This could easily double your monthly minimum payment, which leaves you stuck once again.  In addition to this, even though on paper creditors must re-evauluate your rates, what creditor on this planet is going to voluntarily reduce them?  Also, there is no requirement for creditors to share any re-evaluation details with you.  Here is a BIG opportunity for control that the regulators missed.  It leaves people hanging over a barrell once again with their creditors.

There are some things that are positive however.  According to researchers, the number of credit cards that have imposed an ‘over the limit’ fee is down.  Down to less than 25%, a drop of over 80% for the same cards studied last July 2009.  In addition, arbitration language which was specifically present to limit a consumer’s right to fight creditors in court, is down 68% from last year.  Only 10% of cards now have this limiting legal language.  Consumers can now fight harder in court for disputed debt.

Finally, these slight ‘positive’ changes have not come without a price.  Credit card companies are losing BILLIONS due to the new rules.  Interest rates on new cards are expected to rise.  Teaser rates (0-3% interest rates) are also expected to decline sharply.

So there you have it, the good, the bad & the ugly.  Call it what you like, but we feel creditors will still make it diffucult for you to climb out of debt.  For some, this is impossible.  If that’s you, condiser a good debt management program, debt settlement, or debt resolution.  They may be your only way out and will give you a fighting chance.  Debt resolution, a legal process, generates no taxes on resolved debt.  If you’re considering debt settlement or dealing with your creditors yourself, watch out for the taxes, they could could put you right back where you started, except this time with Uncle Sam.

More information can be found by visiting www.reducemydebtquick.com

Lowest Credit Card Debt in 8 Years: Alaska Has Highest Balances

The credit reporting agencies have stated that US credit card debt balances are at an all-time low; the lowest in 8 years according to the release.  Americans continue to pay down their debt.  Perhaps the economy and employment rates have curtailed spending?

Through the second quarter of this year, the average US credit card balance fell to just under $5,000, down 13% from $5,700 just a year ago.  TransUnion also reports that more consumers are paying their cards on time as well.  Delinquencies fell to under 1% for 90 days late which represents a 17% decrease from Q1 of 2010.

In Alaska however, delinquent payments rose by 7.4%.  In fact, Alaskans carry the highest credit card balances of any state.  So who, you ask, are the states with the highest balances?

1. Alaska: $7,148
2. Tennessee: $5,654
3. Hawaii: $5,594

Iowa carries the lowest credit debt at $3,792 on average, then North Dakota at $4,097 and West Virginia with an average balance of $4,104.  The bureaus also report less credit cards were issued.  Just 12 states report increases with new cards: Washington, Ohio, and Maine.  Georgia, Michigan & Arizona had the fewest number of new cards issued.

Keep in mind that despite this very promising news, if you are carrying large amounts of credit card debt seek professional advice.  Consider a debt management or debt settlement program to help get you out of debt.  Research the company thoroughly as not all companies are ethical.  Performance Debt Resolution helps by disputing your debt with your creditors.  Backed by attorneys, you’ll enjoy an ultra-low 5% fee and no taxes on the reduced amount.

More information can be found by visiting www.reducemydebtquick.com

New Credit Card Laws to Further Protect Consumers

For those of you trying to get out of debt, but creditors keep changing the rules on you, get ready.  On August 22, a new round of rules come out by lawmakers intended to further protect consumers from predatory practices.  Most of the new rules were put in place this year on February 22, 2010 which eliminated multiple billing cycles, interest hikes and requirements of 45 day notices.

The new batch of rules, due out in just a couple of days, are mainly designed to protect card holders from unreasonable interest rates and penalty fees.  The new rules become particularly noteworthy to people who are struggling to get out of credit card debt, yet keep getting hammered by outrageous fees and penalty slaps.  Below is a summary of the 2 major changes in the law which will hopefully help.

1. Interest Rates – For those who carry monthly balances, interest rate hikes have hurt them substantially.  Now, if a credit card company raises your rates, they must tell you why.  Of course this won’t prevent the practice, but it will give you a chance to address it.  If a creditor does increase your rate, they must re-evaluate your situation every 6 months.
2. Penalties – Creditors will generally be restricted to a $25 penalty fee in most cases, unless they can prove that they have incurred more than a $25 expense to justify a higher one.  Also, they wont be able to charge you a penalty fee which exceeds your minimum payment.  Inactivity fees are finally getting banned too.  You wont be charged any more fees for not using the card (even as we type this it sounds ridiculous; a fee for NOT charging something, go figure).  Anyway, inactivity fees are gone.  Finally, creditors can no longer charge a penalty fee for more than one transaction that caused the fee in the 1st place.  For example, if a late payment fee made you exceed your credit limit, you can no longer be charged an over the limit fee on top of the late fee.  This type of ‘double whammy’ is currently widespread in the industry, but no more.

So, we shall see if the new laws will indeed help.  Time, and new data will  tell for sure.  At least Congress and lawmakers are addressing it, with two major revamps in the law in just 6 months.  For now, make sure you curb your spending & get on a budget.  If you’re in over your head already, consider debt management or debt resolution.  They just may be what the doctor ordered to help you get out of debt permanently with your creditors.  Act now on your behalf.  Don’t let credit card companies take a bite out of your financial future.

More information can be found by visiting www.reducemydebtquick.com

Watch Those Mysterious Late Fees on Credit Cards!

When paying down your credit card debt, be sure to pay your monthly payment on time.  Everybody knows that right?  Sure.  Everybody also knows when you don’t pay on time there’s typically an interest hike and a late fee.  Right again!  Do you know what your late fee & interest penalty is exactly?  Well, it’s not always clear what credit card companies charge in penalties.  Even with the new Card Act reform laws that went into effect this past February, some banks remain mysterious.  About half of the creditors do not disclose the interest rate spanking you can get which is typically triggered by late payments.  Rates can sometimes soar to a staggering 30% because of that missed payment!

A tracking study by the Pew Safe Credit Cards Project (home page) found that most banks are complying with the new laws regarding deceiving tactics in marketing efforts.  Prior to this new data, 100% of banks used at least one method which is now illegal.  Many big credit card companies now disclose their penalty rates.  Some do not.  One bank in particular does not disclose their penalty rates.  By the way they’re the largest issuer of cards in the comprehensive study, at 50%.  Why don’t they disclose it you ask?  Good question.  It’s because the new Federal rules require ‘SET’ penalty rates to be disclosed.  This particular bank (chances are you have their card in your wallet or purse) tells Pew their penalties are not ‘predetermined’.  The hikes are figured out on a case by case basis.  If they do decide to jack up your rate, they are required under the new laws to send a 45 day notice.  You know, that notice you get in the mail that’s printed on onion skin paper in font size 4?  yeah, it’s in there somewhere.  Be on the lookout for it & read it carefully.

If you’ve found out that these tactics have dug you deep into debt, consider a debt management solution.  Programs such as debt consolidation, debt settlement and debt resolution are not all created equal.  We’re a big proponent of doing your homework and asking the right questions.  Chosen wisely, the right program can help you get out of debt, making it impossible for credit card companies to ever take advantage of you again.

More information can be found by visiting www.reducemydebtquick.com

Credit Cards: Stealing From the Poor and Giving to the Rich!

Here we go again.  The latest report from a Fed study shows that credit card companies are like a ‘reverse Robin Hood’.  You know Robin Hood.  He’s the guy that used to help out his fellow woodsman and villagers by stealing from the rich and giving to the poor.  Ok, well credit cards do the same thing, just in reverse.  Yes, they steal from the poor and give to the rich.  What does this mean exactly?

Well, the Fed released a report Monday that concludes there is a calculable ‘money transfer’ from non-credit card users to card users.  This means that people paying with cash actually pay more because retailers raise prices to cover the costs of credit card use.  The study also confirms that the MAJORITY of credit card users are usually higher income families.  In the end, card users are typically paid back in rewards from their card use.  The Fed calculated just how many ‘rewards’ are paid to credit card users across the board.  An estimated $23 per year is paid to households with a less than $20K/year income.  In contrast, approximately $756 per year is paid out to families with incomes of $15oK+ per year.  Therefore card users, while still paying the higher retail prices initially, are paid back for their card use.  Cash buyers (generally poorer people) pay high initial prices, but get paid back less.

Many argue that this ‘reverse Robin Hood’ theory is indeed a stretch.  The bigger concern is that lower income families pay higher interest rates on almost everything, including loans, credit cards and mortgages.  Lower income households tend to get into debt faster as well and find it difficult to get out of debt.  Some think we should lobby credit card companies and banks to offer ‘credit challenged’ people incentives such as low fee credit cards or lower limit cards to help rebuild credit.

If you find that you cannot get out of debt, especially credit card debt, available options include: debt settlement, debt consolidation, debt management or debt resolution.  All are viable choices and all have pros and cons to each program.  If you need help, consider your options.  We have written extensively on each program and what they have to offer here:  www.reducemydebtquick.com