by admin | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair
Credit world is a risky world. You need to be careful with your moves, as they are all recorded and can be used against you when necessary. Your bad credit habits and credit mistakes become a huge problem, if not addressed at the right time.
If you are new to the credit system or simply do not have the habit of maintaining your cash wisely, it can be an unfavorable situation for you. Is it never too late to learn? No, not in the credit world! The sooner you learn what credit mistakes you need to avoid, the sooner you will arrive at the safe side of the shore.
Not organizing your expenses and bills
As we said, everything is recorded and reported in the credit world. Your credit history matters the most, and you don’t want anything to stain it. However, if you are not habitual of being on time, you will probably end up with a bad record.
Make sure that you pay all your bills on time and separate your expenses so nothing becomes an obstacle in your next payment. There are many services available online that allow you to arrange your bills and expenses accordingly, with timers and calendars and calculate the amount for every payment. Use them and do not make the mistake of being late. Time is money here – literally!
Being ignorant to the interest charges and rates
It is not wise to not be aware of how much interest you are being charged on every transaction you make and at what rate. Whenever you go for getting a credit card, you must make sure the rates you are being charged, so you can compare it with the other options you have. In addition, it also helps when you are taking a loan. You would not want to be stuck in a loan that charges more interest rate than the other option you could have chosen.
Keep your credit limit down
It is like not being given enough money in hand, just so you will not spend it all at once. What happens is, when you know you have a greater credit limit, you are tempted to make more purchases, and that too recklessly, with a hope that you will somehow deal with it later. Do not do that. Do not fall into the trap of credit card companies, which lure you in by offering higher credit limit.
Giving your credit card to someone else to use
Trusting someone with your credit card is actually a stupid and risky thing do. When you lend your credit card to someone to use, they will make purchases that you will not have any control over. They might not be aware of the interest charges and the rates that comes with each type of transaction. All of this combined will become a problem for you, and if they make any purchase that are illegal, it is you who will have to bear the consequences.
by Ajay oberoi | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Debt Management
Getting up after you have fallen is relatively easy than getting back up after you have gone bankrupt. It is the accumulation of all your bad credit habits and mismanagement over the time that has finally come alive to eat you up – and it did. The only way out is to file for bankruptcy, which is not an easy way out. However, it is not a difficult situation to stay at, only if you understand the process and have enough patience to let it all pass. It may seem overwhelming and daunting to re-establish your credit profile all over again, to attain a good credit rating and to regain your lost confidence.
If you know how to see the wisdom behind all the happenings, you would see bankruptcy as a fresh start, a second chance to avoid repeating the same mistakes and to prove yourself in front of the credit world. Your second chance can be very rewarding if you plan and strategist what your next step would be. You do not want to go wrong now. Which is why there are 3 steps that you need to take after filing bankruptcy.
Stop letting your mistakes haunt you
This is the first and the most important step before you go any further. You cannot allow your mistakes, even blunders, to keep haunting you and mocking you back. It will only eat away your confidence and you will feel stuck in the place you have landed. It clouds the way ahead and does not let you see the opportunities that you seize. The right attitude here will as your armor. You need it.
A lifestyle change
The next step is obvious; you cannot keep living the way you did before. Your lifestyle must change to accommodate your current financial situation, a situation that will take time to get better. Cut down your unnecessary expenses. Identify your necessities and essential expenditures. Cut down on luxuries to save money in order to pay off your debts. If you have filed for chapter 13 bankruptcy, you will have to do this at all costs. The authorities will ask you to reorganize your expenses, and until you have paid all of your debt off, it will stay this way. If you have filed for chapter 7, then you will be asked to use your money carefully, No credit will be given to you at any circumstance until your case has been discharged.
Reestablish your credit rating
Once your case has been discharged, the next step is to build your credit profile. It is a misconception that you cannot get any credit, once you have gotten the word “bankrupt” on your credit report. What you need to do to improve your credit report. For this, start paying all your bills on time. If you have a house, then do not miss out on any of the mortgage payments.
After that, get a secured credit card. It is not as same as the regular credit cards, but it is the stepping-stone you need to cross. It allows you to deposit a certain amount and that amount becomes your limit. They will see how you are repaying your loans, and according to that, will up your limit whenever they feel you are finally learning from your mistakes.
by admin | Bankruptcy, Consumer Proposal, Credit Counseling, Uncategorized
Being in debt is the last thing that anyone ever wants. Somehow it’s something all of us end up being in one way or another. The economy is just not that good and no matter how hard we work to make ends meet, sometimes it is just not enough. Inevitably have to rely on money granting genies.
However, there comes a time when we all think of paying it off and starting fresh with no burden on our shoulders. We make plans and lists of things we would not do in order to pay back the amounts we owe so we can finally move forward.
Just to make the process easier, here are the three basic and easy ways presented which you can work with to lessen the burden from your hard-working shoulders.
Cut Down The Expenses – Temporarily
The first instinct that we feel when we are in such a situation, Is to cut back on expenses in order to save more. And that should be the first step. You cannot start saving money to pay off your loans by cutting down impulse buying decisions. You do not have to put a hold on every expense but only those without which you can still go about your day, for example eating out, online shopping, ordering late-night food, or buying that green scarf. Of course, this will only be for the time being, until you save enough and pay off at least some significant amount of your loans.
Get A Side Job
If you are working a shift in the day and have enough time at hand to do some extra work, it is always a good idea to take on some part-time jobs to get in that extra cash. You can freelance on the internet for writing companies, for digital advertising companies, or simply take neighbors’ dogs out for a walk every morning. This will take away the extra pressure off you that comes with trying to live on a budget. This way you will have more to save and a little extra to spend on yourself.
Take Care Of The Small Loans First
When in debt, we are tempted to pay off the larger ones first. However, that often leads to the accumulation of many small loans, which ultimately become huge. Therefore, it would be wise to list down all your loans. Separate big and small and begin with paying off the small ones until you are done with them, then move on to the bigger ones. This will not only make it easier to focus on paying off larger debts, but it will also allow you to create a comprehensive strategy with complete peace of mind. Organizing commotions and responsibilities always help.
by admin | Bankruptcy, Credit Counseling
Bygones are not bygones in the world of banking and finance. What you do in the past, always comes around and determines the course of the future for you. In the world of credit, your worth is determined by a magic number called a Credit score. This is a mathematical way of expressing the creditworthiness of a person who is applying for credit approval. A credit score is determined by taking five elements into consideration.
- Amount you owe
- Length of time you have been using credit
- The credit mix you have
- New credit accounts you open
- Payment history
Every element has a different weightage when it comes to evaluating your credit score. However, your credit history takes the big chunk of it and has the most significant impact.
The first thing a creditor looks at is your credit history, to get an idea of whether you are good at keeping up your end of the bargain or not. Whether you made the payment at a time or not.
The type of accounts, which the creditors consider when checking your credit history, are;
- Primarily your credit card.
- The retail accounts you have.
- All the installments that are due every month including your car installment or any appliance you got on installments. And how regularly you pay them.
- Your history with other financing companies.
- Your mortgage payments history.
Your credit history is like a report card that a creditor sees. If he sees that you have made late payments, it will not immediately affect your score but if there are late payments for consecutive months, you will have to face some consequences and those consequences will then have an affect your credit score.
First, you will be charged with late credit fee. Then your interest rate will be increased. That increased interest rate is never a good sign. It shows that they have reservations when it comes to trusting you with credit. It will also make it more difficult for you to stick to credit then because it will become more expensive and therefore increase the risk of late payments or no payments at all. This stays on your report for a significant amount of time, maximum for seven years.
Other than this your credit score is also negatively affected by any foreclosures you have against you, any lawsuits that were filed against you, wage garnishments, or if someone has withheld any of your property till the time you pay them off. These all factors are also taken into account including bankruptcy in any form as well.
Credit history constitutes 35% of your credit score, thus a good credit history guarantees that you have a good credit score and more options of credit available to you. A low credit score lowers your credibility as it implies the presence of unfavorable information on your credit report.
by admin | Bankruptcy, Consumer Proposal, Credit Counseling, Uncategorized
5 Things You Must Look For in a Debt Consolidator
Tight economic conditions, inflation, and rising expenses can lead anyone to sign up for some loans. It is almost impossible in today’s times to spend a lifetime without ever getting a loan of any kind. The banks and other creditors know this very well and therefore, they compete with each other to provide different loan products catering to different areas of life.
You can easily find yourself applying for some of these attractive loans and before you know it, your loan bills go through the roof. In case of inability to repay those loans, you are left with a huge amount of debt and debt ultimately translates into financial crisis. Therefore, it’s important that you try to clear your debts as soon as possible using the services of a debt consolidator.
A good debt consolidator helps you get out of your bad financial situation and lead you towards stability. However, you must research well on what kind of debt consolidator is required to meet your needs.
While you are at it, we list here a few things that you must look for in a debt consolidator.
1. Financial and Legal Knowledge
A debt consolidator must be knowledgeable regarding all the matters of loans and debts. They must be able to direct you towards how you can effectively combat your specific debt issues. They use their knowledge to guide you to carry out better negotiations with creditors. This is definitely among the top qualities of a debt consolidator.
2. Empathy
Any debt consolidator who is arrogant, rude, or judgmental towards you while handling your matters will not be able to help you. Good qualities of a debt consolidator include empathy and understanding. Falling in debt is normal and a good debt consolidator knows this well. They will assist you on practical grounds after understanding the nature of your debt and other financial circumstances.
3. Ability to Be Reasonable With Plans
The first and most important thing your debt consolidator will do is come up with a repayment plan. It’s important that the plan your debt consolidator suggests includes an affordable interest rate. If those interest rates are still beyond your budget, that plan will fail. Therefore, the ability to get the full picture of your current and future potential finances while laying out a plan is among the most valued qualities of a debt consolidator.
4. Flexibility
A certain debt problem can be tackled through different approaches. For example, Canadians have multiple methods and options for consolidating their debt, such as Debt Consolidation Program, Debt Consolidation Loan, Home Equity Loan, etc. Not all options are available to everybody and that’s where a good debt consolidator will provide you with expert advice. One of the key qualities of a debt consolidator is that they are flexible with options.
5. Experience
Nothing can beat experience. A debt consolidator who is well-experienced in this field will give you better advice and lead you to the solution in a quicker and effective way. Do some research on how long that debt consolidator has been in the business and how effectively they have been able to help their clients. The economic cycle of the organization will give you an idea.
These are some of the qualities of a debt consolidator that you must consider if you want to avail the best of services.
by Ajay oberoi | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Debt Management
5 Tips on Avoiding Fraud with Better Financial Awareness
Every day, countless people around the globe fall victim to fraud. Identity theft, data breaches, online scams, and other financial frauds have unfortunately become quite mainstream. While new and improved technology has made things easier for consumers, it has also opened doors for fraudsters to design new ways to penetrate people’s financial details and rob them.
The fraud prevention authorities keep on working towards building a fraud-proof system, but they still haven’t been able to completely eradicate the scam mafia and frauds. To be fair to them, complete prevention doesn’t seem practically possible considering the growing reliance on money in today’s world.
However, even under these circumstances, better financial awareness and a sense of responsibility can protect people from becoming victims of fraud.
Following are some essential tips to avoid fraud and practice financial awareness:
1. Keep your financial information to yourself.
‘Phishing’ is a very common scam where fraudsters contact you via email or text claiming they are some retailers or government agencies and try to extract financial details from you. No matter what happens, you must not give out your sensitive financial information to anyone or any organization you don’t know. Your bank or a genuine credit card company will never contact you in this manner and ask for your information.
2. Don’t reveal your Social Security number.
One of the most crucial and yet less discussed tips to avoid fraud is this. A lot of people get emails or texts asking for their Social Security number for whatever pretended reasons. Some websites even ask you to enter that information. Don’t do it. These are mostly scams. An effective financial awareness involves the understanding of what information is confidential and what is the right place to use it.
3. Shred your ATM receipts.
One common mistake people do that puts them at risk of fraud is that they don’t shred their ATM receipts. Some people don’t even take the receipt out and some only discard it on the floor at the same ATM. Fraudsters can use these discarded receipts to carry out identity theft or account fraud.
4. Create strong passwords and change them frequently.
“12345” or “fluffy” is not going to do anymore. Today, when people are required to set passwords on a lot of websites and accounts, they usually go for a simple password and use the same everywhere. Cracking a simple password has become a lot easier and even the repeated passwords are easy to extract. Therefore, one important thing that shows financial awareness is keeping strong passwords that include a combination of letters, numbers, and special characters. Try to keep different passwords everywhere and also, change them often. This can be considered as one of the basic tips to avoid fraud.
5. Double-check the authenticity of an online shopping website.
Online shopping has become prevalent. Massive traffic on these websites has allowed scams to take advantage of it. There are a lot of fake shopping websites. Always opt for a reliable and well-established shopping website and before entering your personal information, check if the website is legit. No list of effective tips to avoid fraud can be completed without this point.
Scams will continue to operate and fraud will continue to affect people. But, you can still use your financial awareness to protect yourself. The above-mentioned tips to avoid fraud are surely going to help you.
