Credit Help To Improve Your Creidt Score

Is the consumer drop in debt due to tightening of belts (as suggested in the article) or is it a reflection of Banks writing off credit card defaults?

Credit cards dropping balances as people continue to work on paying off revolving debt By Reuben Rosenberg – credit.com

According to the Federal Reserve Board, revolving consumer credit fell at an annual rate of 11.7 percent during December. Overall, revolving credit – which is mostly credit card debt – declined from $874.5 billion in November to $866 billion in the last month of the year.

The drop in revolving consumer credit may come as a surprise to some, especially since the numbers reflected the time of the holiday shopping season, where people may bust out their credit cards to make purchases. Along with the decline in December, November saw an 18.6 percent drop in revolving consumer credit.  http://www.credit.com.

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Consumer Credit Counseling: Worthwhile or Worthless?

CHICAGO, IL–(Marketwire – January 25, 2010) – Consumer Credit Counseling — consumers see the TV ads and hear the radio ads on a regular basis. Some of these firms claim to be non-profit while others clearly are a commercial concern. Yet all these consumer credit counseling services claim to be able to help consumers get out of debt. Is this true?

Totaldebtrelief.net breaks it down:

Consumer credit counseling is not the most effective means of achieving debt reduction and debt elimination, but it has its merits. Credit counseling works by a credit counselor or financial planner sitting down with a consumer and reviewing their personal finances in order to determine ways and means to: cut spending, save more, and pay down debt, particularly credit card debt.

Often times through consumer credit counseling it is possible to negotiate extended payment terms with creditors, thereby obtaining slightly lower monthly debt payments. But consumers should be aware of the following: extended payment terms means paying a greater overall amount of money over time. This rarely makes good financial sense. read the rest: Consumer Credit Counseling: Worthwhile or Worthless?.

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FHA Raises Premiums, Down Payments Amid Mortgage Delinquencies

By Dawn Kopecki

Jan. 19 (Bloomberg) — The cost of a government-guaranteed mortgage will be more expensive for U.S. homebuyers as the Federal Housing Administration raises insurance rates and tightens credit-score rules to combat a rise in delinquencies.

The premiums FHA charges to insure mortgages will rise to 2.25 percent from 1.75 percent this year, the agency said in a statement today. Borrowers who have credit scores below 580 will also have to make down payments of at least 10 percent, and allowable seller concessions will be cut by half. read the article here… FHA Raises Premiums, Down Payments Amid Mortgage Delinquencies – BusinessWeek.

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5 tactics of bad debt collectors and what to do about them

By Kerri Fivecoat-Campbell

For the first time in your life, you’re being pursued by debt collectors. You don’t know what your rights are — or if you have any at all.

You’re not alone…

1. Know your rights.
2. Understand negotiation tactics.
3. Unsatisfied? Move up the ladder.
4. Check out credit counselors.
5. Expect consequences if you’re silent.

For more on debt collection, check out this video:
Debt collectors more willing to make a deal

Charges of illegal tactics by debt collectors ranked second in the amount of complaints received by the Federal Trade Commission in 2008. In the first six months of 2009, consumers filed 45,050 complaints with the FTC about debt collectors. That figure is 19 percent higher than the same period in 2008.

Beyond the illegal tactics, there are also tricks of the trade that collectors will use on unwary consumers. In this recession, many consumers are new to collections and may not be aware that although they may owe, they don’t have to put up with abusive collection practices. Read the article and get the details here… 5 tactics of bad debt collectors — and what you can do about them.

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Fed, FTC to Require Notices for Credit Decisions

By Jeff Plungis

(Bloomberg) — The Federal Reserve Board and the Federal Trade Commission announced rules giving U.S. consumers more information when they’re lent money at higher rates because of their credit report.

Consumers given less-favorable terms will be given a notice and the opportunity to get a free report, the Fed and the FTC said in a statement today. Lenders can also comply by giving customers a free credit score, which is usually available for a fee from credit-reporting companies.

Currently, lenders don’t have to explain why a borrower is getting particular terms. The rules will apply to all forms of consumer credit, including credit cards, auto loans, mortgages and student loans. The rules apply to banks and lenders such as auto dealers and financing firms. read more here… Fed, FTC to Require Notices for Credit Decisions (Update1) – Bloomberg.com.

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