Today’s consumer is finding out that one of their most important assets is a good credit rating or credit score.  A good credit rating is one of the keys to financial freedom in today’s economic climate.  

Some consumers have been facing financial hardship such as the lost of a job, reduced salary, divorce, death or a medical emergency. During these time loans, bills and credit cards can quickly pile up and destroy the consumer’s ability to repay their financial obligations. Not only are these obligations weighting heavily on the consumer, the various credit card lenders are increasing the interest rates and fees on the consumer’s credit cards.  

So what is the consumer to do about this situation?  Some of the solutions make sound simply, in a normal economic such as: 

• Borrow only what you need
• Pay all bills promptly and more than the required monthly minimum payment
• Understand your credit report
• Recognize financial situations
• Understand the type of loan you are requesting, is it an open credit, revolving or installment loan.  Know the terms and repayment requirements. 

However in this uncertain financial climate, the consumer may not have the luxury of taking the above steps. The consumer needs to try to at least to rein in their spending and establish some type of budget to mean their monthly obligations. One way to reorganize their financial situation is to:  

• Call their mortgage lender to discuss a loan modification – This will achieve lower monthly payments
• Order a credit report – The consumer needs to know their credit score and identify any errors.
• If the consumer currently has a good credit score, call the credit card companies to obtain a lower interest rate 

If the above does not fit your current financial situation then the consumer needs to look for other alternatives. One of the other alternatives is a debt settlement program.  This type of program is designed to assist those consumer’s who are having financial difficulty. Basically, the consumer sets aside a certain dollar amount each month into a “trust/escrow” account and when there is enough monies available equal to approximately half of your lowest credit card balance. The debt settlement company will start to negotiate with the lender on your behalf.  

So call for a free consultant today with your debt settlement expert.

According a USA Today article, banks are indicating that consumers are catching up on their debt payments.  

As a consumer, do you feel like the roller coaster ride is over and that you are making progress in reestablishing your financial footing? According to Brian Foley, an analyst at Goldman Sachs, says “that a slowing in the unemployment rate holds the key to stabilization.” “As new jobless claims start to slow, there will be fewer people with payment issues,” he says.  

It is for this reason the lenders are more willing to accept a negotiated settlement on outstanding credit card debt. If as a consumer, you still are faced with financial hardship and unsecured debt of more than $10,000 it may be time to consider a debt settlement program.  

A debt settlement program is a third party company which deals directly with your credit card lender.  This program is not a quick fix or an overnight resolution to the consumer’s problems.  The program can take been 12 to 48 months to complete depending upon the amount of debt and number of credit cards.  However, the monthly monies set aside are normally less than the combined monthly minimum payments due on the debt.  

It was been a wild past several years for the consumers.  They have struggled to maintain their residence and their live style.  This burden has taken a large emotional toll on the consumer and their family.  Yes, things seem to be improving within the economic climate but in some cases the consumer is still facing both emotional and financial hardship.  

So now is the time to call your debt settlement expert.  This expert will explain to you the proceeds and this free consultant may give you a piece of mind.  So call today.

As a consumer, it is important to understand the meaning of credit and the affect it has both in the short term and long term on our lives.  

First, credit means money loaned to the consumer either by secured or unsecured method. Secured lending is the mortgage on your personal residence or your car while unsecured lending is the consumer’s credit cards. The lender’s who issue credit cards establish an initial credit limit to the consumer.  As the consumer uses the card in a responsible manner and over time, the limit is automatically increased by the lender.  

A good credit rating is important because it affects every major financial decision the consumer makes. The better your credit rating normally, the lower your interest rate on your mortgage or car loans because you are better credit risk than someone with a lower credit score.  In other words, if you have a positive credit history, meaning you repay your loans on time then you have a good credit.  If you have a bad credit history, which means you are late on payments you have bad credit.  

The three major credit bureaus are: Equifax, Experian and TransUnion. These companies use a scoring system that rates your credit by giving it a numerical number.  This numerical number is considered your score and can range from 300 to 850 depending upon the credit bureau. On average, the majority of consumers should have a score in the mid 700 range to be considered a good borrower.  Anyone with a lower then 650 is considered to be a poor risk by lenders.  

Having indicted that lower than 650 is a poor risk.  Credit card companies continue to issue cards to these borrowers but the rate is much higher than a consumer with a higher credit score.  So how does a consumer improve their score? 

Here are a few ways to improve your score:  

• Make a list of all bills and their due date
• Make a family budget
• Enroll in an automatic or direct payment program – in same cases, you can get a lower rate by using these programs
• Monitor your credit report quarterly for errors
• Consider credit counseling to get tips on how to improve your spending habits
• If divorced, close all joint accounts after divorce. Start to rebuild credit in your own name
• Take responsible for your spending habits 

As a consumer, we need to work on improving our credit score.  However sometimes he might face a financial hardship and need assistance in paying off our unsecured debts. If you are in need of assistance, call your debt settlement expert to discuss how a debt settlement program can help you and your family today.

Today’s consumer is looking for a path to financial freedom during this difficult economic climate.  Even if the consumer has not been impacted with a financial hardship such as a lost of job, reduced salary, divorce, death or medical emergency, they are looking for ways to safeguard their reputation.  

The consumer knows that loans, bills, mortgages and credit card charges can increase very quickly, in particular the credit cards used for day to day expenses, it is a challenge to maintain the monthly payments.  So in order to safeguard the consumer’s reputation and credit score rating, they need to review and relearn ways to protect themselves.  

Some of the things the consumer needs to revisit are the following key ideas:  

• Am I borrowing wisely and paying back promptly?
• Have I identified, avoided and recovered from various financial pitfalls?
• Have a gotten a recent copy of my credit report and do I understand it?
• Does my family have a financial plan for the future  

Every consumer has applied for some type of credit, whether it be for a auto, boat, RV loan, a home mortgage or a credit card.  The consumer has normally been approved for a loan based upon their ability to repay the loan, cash flow and their credit score.  

The key to being a good credit risk is based upon the consumer’s credit score.  This score is a numerical number assigned to the consumer based upon their credit history. This history is based upon number of opened and closed accounts, payment history, including late or missing payments and collection referral, original credit limit, current balances, etc. The higher your credit score is the better your ability to borrow at more favorable interest rates.  The lower the score the consumer is charged a higher interest rate or decline altogether.  

Basically, the consumer needs to obtain a copy of their credit report from one of the following three credit bureaus: Equifax, Experian or TransUnion.  These companies’ reports will explain where the consumer stands when compared to other borrowers along with explaining their financial score.  

Once you have this report, the consumer needs to set down and review this report for accurate information.  Then the consumer needs to revisit if they have enough money to continue maintaining their current score. This means that payments are on time and they are using their credit wisely.

Debt settlement is an alternative method of getting the consumer out of their unsecured debt burden.  It is a program what is intended for those consumers facing undue financial hardship caused by the loss of a job, death of a spouse or medical emergency. The debt settlement option which is available to consumers is sometimes considered the last resource before filing bankruptcy.  The majority of consumers do not want to take that approach since filing bankruptcy would cover both unsecured and secured debt.  Under taking bankruptcy is a major step for the consumer who should consult an attorney to discuss the in’s and out’s of filing bankruptcy.

When the consumer decides to use a debt settlement company one of the issue discussed how this will affect the consumer’s credit score.  In the past, the higher your FICO (credit score) score the better risk you are to lenders.  This score has meant you might be able to get lower interest rates either on your secured or unsecured borrowings.  The three major credit reporting services use a numerical range of between 300 to 800. According to John UYlzhelmer, president of consumer education at Credit.com, “A 700 used to be enough to nab the best rates, but now a consumer needs a FICO score of 750.”

However, if the consumer is seeking out a debt settlement program their FICO score’s have already dropped. The drop in score has been caused by late payment, over limit or high balances. In fact, paying off a card and keeping it inactive will not necessary hurt your credit score nor will it help your credit score.  Recent news articles have indicated that lenders are closing or reducing credit limits on inactive or low usage credit cards.  This is also having a negative affect on the consumer’s credit score.  So this means if you had good credit and are not facing a difficult financial situation, your credit score is dropping anyway.

The good news is as your debts are negotiated your credit score will begin to improve again.  According to creditcards.com, the average household has about $10,679 in unsecured debt.  By paying this debt down, is another key to lifting your score, making up 30 percent of the score.

So either way the consumer’s credit score will be changed overtime.  Whether you use a debt settlement program or you try on your pay down your debt yourself.

Call your debt settlement expert to discuss how debt settlement will work for you.

 When money gets tight and the consumer lose their job, then repaying unsecured credit card debt is hard. The consumer is holding on to make their monthly mortgage or rent payments and put food on the table for their family.  So what is the consumer to do about this situation?

The consumer needs to explore a debt settlement program as an alternative. Debt settlement is a method by which a third party negotiates on behalf of the consumer to reduce and sometime cut in half their credit card debt.  This is not a quick fix or an easy process.  The consumer needs to understand how this program works and how it will affect their credit score.

Any consumer who decides to enter into a debt settlement program needs to be aware of the pitfalls along with the positive side of the program.

 What are the pitfalls:

• Consumer credit score will drop.
• Consumer may face a tax bill on the forgiven debt over $600.00.

What are the positives to this program:

• The consumer now has a plan to climb out of debt.
• The consumer has a timetable for getting out of debt.
• The consumers credit will improve overtime as the debt is negotiated.
• The consumer may not continue to face the harassing collection calls.
• The consumer feels better about trying to resolve their debt by not filing bankruptcy.

Every consumer worries about their credit score.  This credit score is key for allowing the consumer to borrow whether to purchase a home, car or apply for a new credit card. So once the consumer starts on the debt settlement program, one of the key steps to helping you’re current score is to continue making all other payments on time,  This means making your monthly mortgage, auto and equity line payments.  It is important to continue meeting your secured debt obligations.

So call today to discuss debt settlement as an option for you and your family.

As a consumer, we need to understand the meaning of the word credit.  Credit is considered as either secured or unsecured monies loaned to you by a lender, in return for future payment.  Lenders or creditors who have advanced to you monies to purchase your home or credit card companies/retail stores  which allow you to charge purchases with the understanding you will pay them principal and interest over a period of time. 

In order to qualify for anytime of credit, you need to have good credit.  A good credit score means you are a low risk consumer while a lower credit score means you are a riskier borrower. Credit scores from the three major credit bureau’s (Equifax, Experian or TranUnion) range from 300 to 850. 

However, according to a recent article in “USA TODAY”, lenders are clamping down on credit and credit scores are taking a hit. So what does this mean for the consumer? Basically this means that lenders are reviewing all of their consumer credit cards and making determinations about who is using their credit cards.  Lenders are closing credit card accounts and lowering credit limits for millions of consumers who have never paid late. When a card is closed by a lender this effects your credit score. 

However, maybe as a consumer you had a fair to good credit score.  But do to the recent economic environment you are not able to keep up with your financial obligations.  This is going to affect your credit score since late payments, mortgage modifications and high balances are now taking a bigger toll on your scores.  

So when you are looking at debt settlement program and you are informed that your credit score will take a hit. You credit score may had already taken a hit because of your late payments and too much credit with high balances prior to entering into a debt settlement program.  

Basically it does not matter whether you had good credit before since the lenders are taking steps to reduce credit and closing accounts for the consumer.  This affects your credit score in a negative way whether you are current on your payment or delinquent on your payments. 

So do not let the fear of your credit score dropping from looking at a debt settlement program as an alternative to your financial situation.

Debt Settlement and Your Credit Score

“Nothing is particularly hard if you divide it into small jobs” ..Henry Ford

Henry Ford’s quote is right because every situation, we face needs to be viewed in small pieces.

We need to break down what our credit score means and how it is used when measuring the creditworthiness of the consumer. You need to understand what credit scoring is and how it is used by lenders before considering debt settlement as a way out of your current financial situation.

• Did you know that your credit score changes every month?
• Do you monitor your score on either a monthly or quarterly basis?
• Did you know that income is not considered by the major credit bureaus when calculating a credit score?
• The lower your credit score, lenders may deny credit and charge higher interest rates
• Do you know your credit score? The credit score range can be from300 to 850

The credit score is a mathematical figure which takes into account, the  following factors but not limited to :

• Number of accounts, either secured or unsecured
• Length of credit history
• Credit Limit
• Highest Balance
• Payment History
• Usage
• Public Records, i.e., tax liens, judgement, bankruptcy

One of the first question always asked is will debt settlement affect my credit score? Yes, in the beginning as your accounts start to go delinquent your credit score will drop.  However, once we start settling up your accounts and your debt ratio starts to improve, you will notice your credit score starting to go back up. Again, you should be aware that your credit score will change monthly whether you are in a debt settlement program or not.

A bankruptcy will be shown on your credit report for 10 year and will continue to drag down your credit score.  While delinquency will also affect your credit score but only for a shorter period of time. By using a debt settlement program, you will be able to start reducing your credit balances and will be showing lenders your willingness to pay your obligations.

As you paid off your debt, your credit score will start to improve and allow you to move forward.  You will stop having feelings of being so “lost” with your finances. Because you will now be in charge.