Your Debt Collection Rights

January 27th, 2012 | Posted by in Debt | Personal Finance - (0 Comments)

Every year, debt collectors are continually at the top of the list for most complaints by consumers.  Many of these companies are in direct

Fair Debt Collection Practices Act

Fair Debt Collection Practices Act

partnership with the original creditor.  Their primary goal is to wear you down so that you will pay on your unpaid debt.  Even what is allowed by law can feel like you are under assault, especially if you have more than one debt account in collection.   An unpaid debt will remain on your credit report for up to 7 years.  Any deferred payment plan established with a collection agency or creditor will reset the clock on what is submitted to your credit report to the full 7 years from account activity.

 

Your Debt Rights
The Fair Debt Collection Practices Act was established to protect consumers from out of control collection agencies.  This law however has not stopped illegal and questionable practices.  You do have the right to not accept phone calls when notifying the creditor of your request to cease all communication by telephone and request that all correspondence be in writing and mailed via certified mail.

Here are some important rights of the Fair Debt Collection Act:

  • A collection agent can not call or write you more than 3 times a week.
  • A collection agent can only call you once a day at work.
  • A collection agent can not call you between the hours of 9 pm and 8 am.
  • A collection agent can not threaten you with violence, criminal lawsuits, or use offensive language.
  • A collection agent must stop calling you when you submit a written statement that it can not continue to call or write you demanding payment for debt.
  • A collection agent can not contact you if you have an attorney handling the debt.
  • A collection agent can not tell other people including your employer that you owe money.
  • A collection agent can not force you to submit a post dated check.
  • A collection agent can not publish a list of people that owe money.
  • A collection agent can not impersonate a law enforcement agent.
  • A collection agent can not make collect phone calls to you.
  • A collection agent can not threaten to have you put in jail for unpaid debt.

Download The FTC Credit And Consumer Reports Guide

 

Time Barred Debts – Clock Reset
A debt will remain on your credit report for 7 years.  If no payment is made to pay down the debt, the item in question will expire from your credit report in 7 years.  If a consumer makes a payment on a debt before the Statute Of Limitations expires, the statute clock resets, providing the collection agency or creditor additional time to sue you.  A debt which the Statute Of Limitations has expired is referred to as a Time Barred Debt.

Statute Of Limitations To Sue
A lender or collection has the right to sue you to collect unpaid balances, even if they purchased your debt for pennies on the dollar.  One thing that may eliminate the collection agency from suing you is your State’s Statute Of Limitations. Each State has their own time period that a collection agency or creditor may sue to collect unpaid debts.  The Statute Of Limitations also varies on the type of debt as well.  Debts are classified into four categories:  Oral Agreements, Written Contracts, Promissory Notes, and Open Accounts.  Each State sets it’s own classification of debts, which is why some States classify credit card debt as a written contract and others an open account.

The States with longest statute of limitations for written debts are Rhode Island, Ohio, and Kentucky with a 15 year statute.  The States with the shortest statute of limitations for written debts are New Hampshire, Maryland, and North Dakota with a 3 year statute.  The average statute of limitations for written debts is 6 years. Most States will classify credit card debt as a written contract.  Once the Statute Of Limitations has expired, a creditor of collection agency has no legal right to sue you to collect.  This litigation avoidance does not eliminate the debt from your credit report, or eliminate future collection notices.

Contact your State’s attorney general office to determine your state’s statute of limitations and debt classification.

Gift Cards

, , ,

5 Things That Make Up Your Credit Score

January 22nd, 2012 | Posted by in Credit | Credit Score | Personal Finance - (0 Comments)

Good credit is one of the most important factors of a healthy personal financial plan.   A credit scoring system was created by the major credit bureaus to determine with one simple number your creditworthiness and ability to repair a loan.  Lenders for home loans, car loans, student loans and credit cards will base your interest rate primarily on your credit score.

Credit Scores

How Your Credit Score Is Calculated

A Credit Score or FICO Score can range from a low of 300 to a high of 900.  If you have a high credit score, you may benefit from lower loan and insurance rates.  If you have a low credit score, you may experience higher interest rates on loans and insurance premiums.

 

Your credit score is comprised 5 primary categories:

  • Your Payment History
  • Amounts Owed
  • Length Of Credit History
  • Types Of Credit Used
  • New Credit  

 

More than one half of your credit score is based on how much you owe and your past payment history.  Credit scores DO NOT factor in your housing status (rent or own), your income, the time at your current job, or the amount of time located in your current residence.

Gift Cards

,

Tips To Save Money On Gifts

November 23rd, 2011 | Posted by in Personal Finance | Saving Money - (0 Comments)

Whether you are shopping for a birthday, Valentines Day, or a great Black Friday Christmas deal, everyone wants to

"Crowded Shopping Mall"

Shopping Center

save money.  But how can you be absolutely certain you got the best deal? We have compiled a short list of the best tips to save money and time shopping online or at brick and mortar stores.

Tips To Saving Money

Get The App
The fastest way to compare the widest array of retailers is by using a mobile app.  There are apps that will allow you to shoot a QR code/bar code to compare prices.

Join The Mailing List
You can subscribe and receive exclusive discount coupons by email just for signing up with your favorite retailers rewards programs or subscribing to their news.  Subscribers generally will receive advanced notice of sales and specials.

Double Coupon
If you are unable to get a once in a lifetime door buster deal, double coupling may still save you a considerable amount of money.

Give Experiences Not Stuff
Not sure if you were supposed to get a Nintendo Wii or and Xbox?  Most people can not remember what they received the previous birthday or for Christmas.  Why not give experiences?  At the most expensive end a vacation will always be memorable to any family member.  Rock climbing, ski lessons, and fitness memberships also make for great experience gifts.

Celebrate Christmas On New Years
Companies after Christmas need to reduce their product inventories due to various inventory taxes and the change of product lines from winter to summer.   You can save a lot of money shopping after Christmas.

Secret Santa And Group Buying
Is this the year your family is considering an expensive, big ticket item?  One way to reduce the cost is to make it a group gift, dividing the cost amongst other family members like parents or grand parents.  Another frugal tip to save money overall, is to enact a Secret Santa gift giving policy.  Each person secretly selects another and has a specific dollar cap limit.

Gift Card Bonus Value
Many retailers will offer a gift card at a higher value than what you pay.  An example might be a sale on iTunes gift cards where you may be able to purchase $100 worth of iTunes cards for $80.  That’s a $20 dollar gift giving bonus!  Apps and songs sold in the Apple iTunes store also go on sale just as regular products.

Tips To Get The Best Deals

Artificial Discounts
Don’t be fooled by discounts off of the “List Price”.  This is a tactic borrowed from car dealers.  Retailers will inflate the price to the MSRP, which they never sold the item before, and offer a deep discount on the inflated price.

Limited Quantities
When there is a large shopper demand and a known shopping sales event such as Black Friday, Fourth Of July, Memorial & Labor Day, retailers will offer extreme discounts on a handful of items.  What they might not tell you (it may be disclosed in fine print in their ad or website) is that there are limited quantities of such an item (generally about 10 items per store).  The retailers principle goal is not to offer you a great deal, but to create a frenzy by attracting a large shopping crowd generally early in the morning.  They assume that if you wait inline for hours and don’t get that flat panel HDTV for $299, you will not leave empty handed, and purchase another television model.

Price Match Guarantee
Most retailers have a price match policy.  However, many will not match an extreme deal or clearance price.  It doesn’t hurt to ask though.  When asking for a price match, be sure that the products are the exact model number, and have printed proof of the comparative retailers price.

Return Policy
A store with a flexible return policy might be worth the extra price.  Consider a liberal return policy and added insurance plan for your purchase.  Stores with no questions asked policies will let you return an item even after it has been used.  The most important use of a great return policy is to protect your purchase price while still shopping for a great deal.  It allows you to buy an item from one store while continuing to shop for a better deal elsewhere.  Confirm with each store what their specific return policy is on your particular purchase, different items like electronics and tools may have different return policies.  Some retailers may also place their return policies on the receipt as well.

Low End Products
Most retailers will put lesser models on featured discounts.  These are generally not a brands mid or top of the line products, which is why they are so cheap.  These models offered have reduced specs or performance (especially electronics and TV’s).  Often, they are bundled with other accessories to create a value bundle.

Final Price
When fully considering a big ticket purchase, be sure your total includes applicable taxes, shipping, and fees.  You may think that a deal offering 10 percent off is great, but if you have to pay sales tax and shipping on top of that, your discount is easily diminished.

Buy From Who You Know
If you find an excellent deal online, be sure that someone you personally know recommends the online retailer.  Don’t fall victim to the ratings of an online retailer unless they are compiled by an independent third party such as the Consumer Union.  Even retailers feature on Amazon should be avoided.

Gift Cards

, , , ,

What Is An Average Credit Score For Your Age?

November 21st, 2011 | Posted by in Credit | Credit Report | Credit Score | Personal Finance - (0 Comments)

Your credit score can be between 300 to 850.  Statistically, each age group can have an average credit score range.

"Credit Score"

Average Credit Score By Age

Younger people under the age of 25 most likely have had less credit history compared to an older age range, therefore the average credit score for the under 25 age group is 640.  While age can not be used as a determining factor in a persons credit score, the amount of time you have had a positive or negative credit history will affect your credit score.

Age based credit score averages assume that if you are under the age of 40, you are more likely to have had late payments.  When you are in the age bracket of 40 – 60, it assumed that you will be carrying the most debt out of any other age group.   By the time you reach the over 60 years old group, it is assumed that you will have the lowest usage of credit against what was extended to you.  No matter what your age, the key point in maintaining a good credit score is consistency.  Living within your means, steady and balanced credit usage throughout your life is what creditors desire.

All of these age based credit score averages primarily assume that with age, a person establishes a better credit history due to increased income earning ability as we age, and a longer credit history to balance out good credit and bad credit events.

A good credit score around 720 will provide better interest rates for a home mortgage, credit cards, and other lines of credit.  A bad credit score below 550 will make it difficult for a person to obtain favorable credit and loan terms.

Gift Cards

, , ,