Tag: credit card debts
You never want to hear your waiter say, “Sorry, your card was declined.” For people with bad credit, hard times are inevitable. When they occur, you can dig a deep hole and crawl in, but there are better ways to respond. Here are the most common scenarios involving embarrassing credit and answers most worthy.
1. “I’m sorry sir, but your card was declined.”
When a boy says these terrifying words, you are bound to flush crimson dining companions as speculate on the state of your finances.
Squelch panic, “said John Ulzheimer, president of consumer education. Explain calmly that the tape may have been damaged, and make another card for the purchase. If she was denied because you are maxed out, however, and you have no plastic or other cash, excuse yourself and call the creditor to request an “opt-in for overlimit fees.“” This will allow operations overlimit to fill, “says Ulzheimer. You will be assessed a fee, but your reputation will be saved.
2. “Er, Jane, we need to discuss this issue before you pay.”
It’s awful to be sued for a debt, but it is horrible when your employer receives an order for garnishment of wages, a part of your salary should be given to your creditor.
Do not wait until the sheriff to serve hits the paper, said the trust expert Delores Pressley. Be proactive and request a meeting with your boss, saying: “I am terribly sorry that a personal question has extended to the workplace. I’ll find a solution as quickly as possible. “This straightforward approach may compensate for a negative opinion of your supervisor. Also, you can not be fired for garnishment (unless there was more than one in a period of 12 months), which may inspire some confidence.
3. “Rent to you with your bad credit? Ha!”
Ready to sign a lease? If your credit is terrible, you could be in the same humiliation that Matthew and Fiona Peters, Madison, Wisconsin, experienced. As newlyweds, Peters thought they had found the perfect apartment. Yet in the rental office crowded, the agent announced loudly: “There is no way that we can rent with your credit. It is bad… very bad. “Every parent called and asked for help in vain.” After the second call, we sat there red-faced, wondering what we were supposed to do or say next, “said Matthew Peters.” It was emasculating! ”
Today, Peters offers advice to others in similar situations, “Keep your cool and do not take it personally seen a high level for all residents not only protects the property owner’s investment, but people living there as well.. “Focus on your finer points.” You could say: “My credit is bad, but I’m busy and make it a point to always pay for my first home,” said Peters. You may need to sweeten the deal by offering a co-signer, doubling the deposit or to pay rent in advance.
4. “Great, once we see your credit file, we can complete your job application.”
credit checks pre-employment are the norm today – and you’ll want to hide if yours is full of big balances, late payments and accounts written off.
Sure, you can deny access to your reports, but it could encourage the hiring manager to build your resume. So stand tall and to disclose past problems at the front. Honesty can not increase your chances. And relax on shamefully low credit rating. “The credit bureaus and their professional organization (the consumption data Industry Association) have publicly stated countless times stating that they do not provide credit ratings and audit reports of the working credit” says Ulzheimer.
5. “Darling, I can not wait to start a life with you – buy a house, have children …”
Have terrible credit, but in the beginning of a long term relationship? Assuming it can be scary. Like it or not, you must reveal the horrible truth. Then, commit to open communication and make amends, “said Joe Rubino, author of” Self-esteem book.”
“Contact all debtors, make arrangements to clean the debts, start a savings plan, cut credit cards and take full responsibility for the management of future purchases responsibly.” Strengthen your skills and your faith life partner through financial counseling, therapy or life coaching.
6. “I need to talk with Mary about a bill pending.”
Whether calls or messages collection go to your workplace, roommate or relative, your private situation will become public. First, the end of the phone calls. The Fair Debt Collection Practices Act prohibits collectors third discuss your debt with anyone but you. And while they may contact you at work if you ask them to stop, they should.
Tell them you know the law and that you will file a complaint with the Federal Trade Commission, if they persist. Then, “said Rubino, act with integrity and clean up your mess of money. “This done, he is afraid of anyone except your own. If you feel the need to explain calls to anyone, just say you made financial arrangements to settle debts and the case is supported “.
7. “OK, Phil, go ahead and charge those costs and we will reimburse you.”
A business trip is imminent and you are supposed to book a hotel room, flight or rental car. Uh oh, you have no credit. Do not worry, you’re not the only one not charging fees. About 29 percent of Americans live without credit. Suffice it to say that you only use cash, and ask to be paid with corporate funds or corporate card. Few employers balk at such a reasonable request.
Is it easy to deal with these credit problems mortifying gracefully? Of course not. But keep in mind that even a show of assurance from the air – and feel – better than avoidance.
A $10 purchase can help you save more than $40 a month — and get you started on paring down what you owe.
If you find yourself falling deeper into credit card trouble, it’s time to take a hard look at what’s coming in, what’s going out and see where you can free up some cash quickly to start hacking away at your debt.
Some trims may seem small, but if you package several of them together, you can soon get started on a respectable payment plan. Here are some ideas for places to turn first.
1. Cell Phones
“For $9.88, you can buy a TracFone (prepaid cell phone) with pretty decent coverage and pay by the minute,” says Mike Sullivan, director of education at Take Charge America in Phoenix. “And if you’re careful, you can end up saving $40 to $50 a month off a typical $80 cell phone bill.” He also recommends canceling your land line unless you have medical issues that may require emergency calls.
2. Cable / Satellite
Most people can save money just by getting rid of the extra pay packages they have — such as premium movie channels and extra services. “If you’re really in trouble, cancel the whole package,” Sullivan says. Check out the library for free movies, DVDs and CDs to bridge the entertainment gap.
3. Homeowners Insurance and Car Insurance
By increasing the deductible of your policy from $500 to $1,000, you can see big decreases on your premium, says Michael Barry, vice president of media relations for Insurance Information Institute in New York. “People pay about $880 a year, so if I can knock $88 off, it’s a start.” Regarding auto insurance, take a look at your collision insurance if you have an older car. If you have even a fender-bender, sometimes the cost to repair the car would be more than it’s worth, so perhaps you could cancel the collision insurance altogether.
First, look up the value of the car at Kelley Blue Book, Edmunds.com or the National Automobile Dealers Association, then check the collision line on your auto insurance bill and see what it’s worth to you to keep that insurance. Also, if you don’t drive that car much, look for a discount. “If you drive from 7,000 to 7,500 miles a year, you can often qualify for low-mileage discounts,” Barry says.
Americans are increasingly finding alternatives here. In fact, consumers spent 11 percent less last year in this category, according to the Bureau of Labor Statistics’ 2009 Consumer Expenditures Survey released in October. If you have more than one car, this may be the time to look at downsizing to just one car and getting around with better planning, carpooling, bike riding, public transportation or car sharing. Car-sharing companies such as Zipcar operate in a growing number of cities and on many university campuses. You can rent a car by the hour when you have to have one without the expense of insuring and maintaining your own car.
“People often overlook programmable thermostats,” says Edward Tonini, director of education of Alliance Credit Counseling in Charlotte, N.C. “You can spend $20 to get a programmable thermostat and if you set it right, it can save you $100 over the course of a year easily.”
Households spent an average of just more than $300 a month on food eaten at home and about $215 per month on food outside the home in 2009, the BLS survey reported. “Maybe eating out isn’t necessary for you,” Tonini says. “Packing lunches and eating at home will lower your discretionary spending.”
7. Gym Membership
Are you really using it multiple times a week? Divide your monthly dues by the number of times you go in a month and get a realistic picture of what you’re spending on a one-hour workout. Park districts or community centers often have low-cost or free programs. Also check into exercise videos or a piece of home exercise equipment that you would use regularly. If you decide to keep the membership, check to see whether the facility offers discounts for coming at off-peak times.
A family of four can quickly rack up nearly $100 on one movie with popcorn, drinks and maybe even parking fees. “Instead of going to the movies, have a game night at home. It sounds kind of corny, but it will be more meaningful than sitting in the dark when you can’t talk to each other,” says Dave Gilbreath, a regional director with Apprisen Financial Advocates in Yakima, Wash.
9. Tax Relief
Wendy Burkholder, executive director of Consumer Credit Counseling Service of Hawaii in Honolulu, says, “Many of the families we work with are struggling with credit card debt because of loss of income. One of the first things to do is re-evaluate your tax withholding on your paycheck (if your spouse or partner has lost a job). If you don’t make the change, you end up with a whopping refund. You don’t need the money a year from now, you need it now.” If you’re overpaying taxes, you’re also giving the government a free loan and are likely putting off paying for your own bills, which can lead to fees and penalties, she says.
10. Health Insurance for Dependents
“If you’re struggling with loss of income, you may no longer be able to afford $600 being deducted from a paycheck to cover your dependents,” Burkholder says. She suggests checking to see whether you now qualify for a state or federal coverage plan for dependents, such as the Children’s Health Insurance Plan, or coverage by health care providers that may offer reduced prices for basic health care for children.
Deciding what to cut first will be different for every consumer, but whatever the choice, it should be sustainable, rather than a one-time quick fix, Tonini says. Sometimes it’s cutting out the daily $4 coffee, but “they need to figure out what their ‘latte factor’ is.”