Screws Tighten for U.S. Credit Card Borrowers With Higher Payments, Rising Rates, Looming Bankruptcy Reform
(ContentDesk) October 7, 2005 -- Delinquent credit-card accounts have risen to an all-time high. Credit-card issuers are instituting new payment policies upping minimum payment requirements, and raising rates at the same time. Add in the new bankruptcy law, which takes effect on Oct. 17, and the forecast isnt pretty, according to Brad Stroh, co-founder and co-CEO of Freedom Financial Network, LLC.Beginning this month, most lenders are instituting new minimum-payment policies to comply with requirements of the Office of the Comptroller of the Currency (OCC). The new policies require minimum payments to cover interest, fees and a portion of the loan principal each payment period.
As a result, borrowers will see their minimum payments increase from approximately 2 percent of the principal balances on their credit cards to 4 percent, meaning a doubling in payments for many.This material increase in monthly minimums comes at a time when the American consumer is already overburdened. Last months increase in interest rates by the Federal Reserve the 11th straight brought rates to the highest level in more than four years. This directly hits a borrowers pocketbook, because credit card and unsecured debts typically carry variable rates, explains Stroh.Recent news from the American Banking Association puts delinquent credit-card accounts at 4.81 percent of all accounts, a record high. Nearly all other types of loan delinquencies also are on the rise, the organization says. Stroh attributes this increase to several factors whose combination puts ever-greater numbers of American families in financial crisis, and he suggests debt-relief options consumers can use:1.????Cost of living increases Prices continue to rise for essential items ranging from gasoline (up 31 percent in the past year, according to the Consumer Price Index) to health insurance (with employees paying 64 percent more in health care costs than they did five years ago, according to the 2006 Towers Perrin Health Care Cost Survey).Solution: If youre struggling with credit card debt, stop charging and live within your means, even if it means a spaghetti-only diet.
Find out if you can carpool, use public transit, or work from home to cut transit costs. Turn the furnace down this winter. But do keep a health insurance policy in effect, Stroh says. People run into serious financial trouble if theyre hit by an unexpected, enormous medical bill. 2.????Rising credit-card interest rates Eleven sequential interest-rate increases by the Federal Reserve have led to big hikes in credit-card interest rates, after rates were low for several years during the U.S. recession of the late 1990s and early 2000s.
If consumers got into irresponsible habits during that time or were driven by emergencies to rely too much on credit cards theyre treading water now just trying to catch up, Stroh explains.Solution: Pay off cards fast, putting the largest payment on the card with the highest interest rate until that card is paid off, then paying off other cards in descending order. If you have good credit but see your rates climbing, call your creditor to ask for a lower interest rate. If youre having trouble meeting minimum payments, you might try negotiating with creditors and asking for temporary hardship status, where a creditor sometimes agrees to a lower payment for a longer term of credit. 3.????Increase in credit-card minimum payments Stroh reminds borrowers that the intent of the higher payment is to help consumers pay off their debt faster, with less of their payment going to interest. But for someone who is already struggling month-to-month, that higher payment just means an even bigger source of financial agony. Solution: If you can pay the higher payment, do so.
If not, dont panic and dont rush to thoughts of bankruptcy. Talk with a debt advisor he or she can help you determine whether debt resolution could help by negotiating with creditors on your behalf to lower principal amounts due (you would then pay the debt resolution firm a percentage of savings obtained). Savings can be as much as 60 cents on the dollar typically much better than Chapter 13 bankruptcys repayment plans offer and with no bankruptcy judgment on long-term records.Freedom Financial Network, LLC (www.freedomfinancialnetwork.com) provides consumer debt resolution services through its Freedom Debt Relief, Freedom Foreclosure Relief and Freedom Tax Relief divisions. Working for the consumer and negotiating with creditors to lower principal balances due, the company offers an alternative to bankruptcy, credit counseling, and debt consolidation. Based in San Mateo, Calif., Freedom Financial Network serves more than 3,000 clients nationwide and manages more than $100 million in consumer debt..
Chapter 7 Bankruptcy
When you file Chapter 7 bankruptcy (liquidation bankruptcy), your first step is to contact a bankruptcy lawyer to get you through the process. Your attorney will prepare and file documents to the US Bankruptcy Court clerk. The forms will contain your complete financial information, your income, expenses, property and debt.Next you will meet with the court appointed trustee at which time your creditors will be notified and they can no longer contact you to attempt to collect any debt you may owe. The trustee will take your non-exempt assets and sell them to pay the trustee's fees, administrative expenses and your creditors.Once you have complied with all the courts requests, than an order will be filed discharging you from your debt..
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United States Bankruptcy Judge James G. Mixon Refers Man to U.S. Attorney for Criminal Charges for Perjury Because he Testified that he Forgot an Income Tax Refund
(ContentDesk) September 2, 2005 -- U.S. Bankruptcy Judge James G. Mixon has referred a man to U.S. Attorney for criminal charges for perjury because he testified that he forgot an income tax refund. U.S.
Attorney alleges that depositing tax refund is laundering money. Wife has been threatened with charges of money laundering for depositing lawful income tax refund and asked to plea bargain on charge of misprision of felon.Stephen and Barbara Griffin of Arkansas (Case No. 5:2-bk-70245M, filed in the United States Bankruptcy Court for the Western District of Arkansas, Fort Smith Division) have been encouraged to plea bargain rather than go before a jury of their peers. On February 17, 2005, Assistant U.S. Attorney Steven Snyder sent correspondence to Stephen Griffin alleging that U.S.
Bankruptcy Judge Mixon referred Stephen Griffin for criminal charges of perjury and money laundering.On August 30, 2004, the newspaper, Times Record, of Fort Smith, Arkansas, reported that Stephen...
United States Bankruptcy Judge James G. Mixon Refers Man to U.S. Attorney for Criminal Charges for Perjury Because he Testified that he Forgot an Income Tax Refund
Bankruptcy > United States Bankruptcy Judge James G. Mixon Refers Man to U.S. Attorney for Criminal Charges for Perjury Because he Testified that he Forgot an Income Tax Refund
Chapter 7 Bankruptcy Software
This is the age of computers and the computer has given its Midas touch to each and everything in our life. Legal procedures have also witnessed the information technology revolution. As many software and web based solutions are available for legal work, one can file for bankruptcy using the computer.
A bankruptcy software program has been developed to the high standards of quality, accuracy and professionalism. This software uses modern database technology and guides users through a straightforward entry program to let users easily create, print, edit and reprint bankruptcy forms. The printed forms are ready to be filed.
The bankruptcy software is not a forms kit or a web based data collector but it's a simple land-secure computer program that one can use to create bankruptcy filing and to organize the forms. It has better features than a word processor and a PDF generator. With the user-friendly interface of the software, one easily create calculations, mailing...
Chapter 7 Bankruptcy Software
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The Right Way To Credit Repair
If you have a bad credit rating, then you might find that your ability to get financing, loans, and even some jobs is greatly diminished. Once you have a bad credit rating, it might seem like there's nothing that you can do about it? but you don't have to believe that. It's not as difficult as you might think to get by with a bad credit rating; with a little work and time you can even repair it! Of course, before you do that it's important to realize exactly what a credit rating is. Every time a lender or other creditor makes a report concerning your payment history to them, this report affects your credit score. Your credit score is a numerical indication of the positive and negative reports that you've received from creditors and lenders; if the number is high then you have a good credit rating, and if it's low then you have a bad credit rating.
Basic credit repair Get organized! Make a folder for all your correspondence offline and online. You will have to do some snail mailing...
The Right Way To Credit Repair
Bankruptcy > The Right Way To Credit Repair
Bankruptcy
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