Credit Cards For Fair Credit » Consumer Credit Counseling

Credit Counseling Ripoffs

Author — Sun, 05 Sep 2010 10:13:18 +0000

A respected credit counseling agency will assist you to build a repayment program in your creditors and show you better money management techniques to avoid debt in the foreseeable future. However, many credit advice services take advantage of people who are usually financially vulnerable, so proceed cautiously.

The Federal Trade Commission Act forbids "unfair or deceptive acts or practices" of credit repair, debt settlement or counseling agencies. Some states also have laws that make it illegal for credit service organizations to claim to be able to improve credit scores.

And in some states, consumer credit counseling services must register with the state Attorney General's office and get a surety bond to work.

Voluntary Certification and Accreditation

The National Foundation for Credit Counseling (NFCC) is an independent not-for-profit organization that creates voluntary benchmarks for credit advice agencies. The NFCC Council on Accreditation (COA) accredits over 4,000 credit advice packages that meet NFCC standards.

In order to be accredited by the NFCC, a credit counseling agency must be recognized as non-profit by the IRS and also have the proper local business licenses. To earn NFCC certification, a credit guidance program must use adequate checks and balances to protect consumers, including:

Auditing operating and trust accounts every year
Offering consumer education programs
Providing detailed reviews of consumers' income and debts, and an assessment of how each consumer got into financial trouble, with a written action plan for reducing debt
Disbursing funds to creditors at least twice a month, or sooner in emergencies
Giving clients a financial statement at least once every three months

The Association of Independent Consumer Credit Counseling Agencies (AICCCA) is the one other national organization with similar standards.

You have to think one more time before joining a credit counseling agency that does not belong to either of these voluntary organizations.

Warning Signs

What should tip you off that you might be dealing with a less-than-reputable program?

Look out for illegal fees, sometimes disguised as contributions. In the event the setup fees or monthly charges are incredibly high, they will block out any gain you may have made against reduced finance charges, and you would bemore well off negotiating directly along with your creditors.

Another danger sign is often outrageous statements to instantly repair your credit ratings. Credit rebuilding is really a gradual process, and it's illegal to try and change your credit history by constructing a brand new, false identity.

Its also wise to avoid advance fee loan scams, where you're asked to fork over money to secure a promised loan. Under the FTC's Telemarketing Sales Rule, there's no-one to legitimately ask that you pay before you actually receive a loan or credit. So be skeptical of any debt consolidation loan, get everything in writing, and don't give your bank card, banking account or Social Security information on the phone or online.

Educate Yourself

The most effective way to protect yourself against unscrupulous credit counselors is to:

Check out the program's reputation with your state Attorney General and local Better Business Bureau, and find out how long they've been in business
Confirm with your creditors ahead of time that they will work with that particular company
Understand exactly what services are offered, and whether those services address all of your debts
Get the specifics of any monthly fees, and find out whether you'll still be obligated to pay those fees whether or not you continue to participate in the program
Get all promises in writing
Read your written agreement carefully

For help with a Savannah GA chapter 13, consult with a Savannah Georgia bankruptcy attorney. A bankruptcy attorney Savannah GA could give you the help you need.

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Chapter 7 Bankruptcy: The way it Works

Author — Thu, 26 Aug 2010 14:38:02 +0000

A chapter 7 case begins with the debtor submitting a petition to the bankruptcy court serving the spot in which the individual lives or where the business debtor is organized or has its principal place of business or principal assets. (3) In addition to the petition, the debtor should also file with the court: (1) schedules of liabilities and assets; (2) a schedule of current income and expenditures; (3) a statement of financial affairs; and (4) a schedule of executory contracts and unexpired leases. Fed. R. Bankr. P. 1007(b).

Debtors must also provide the assigned case trustee a copy of the tax return or transcripts for the most recent tax year in addition to tax returns filed during the case (including tax returns for prior years that had not been filed when the case began). 11 U.S.C. √ü 521. Individual debtors with primarily consumer debts have additional document filing requirements. They need to file: a certificate of credit advice in addition to a copy of any debt repayment plan developed through consumer credit counseling; proof of payment from employers, if any, received 60 days before filing; a statement of monthly net revenue and any anticipated increase in income or expenses after filing; and then a record of any interest the debtor has in federal or state qualified education or tuition accounts. Id. A husband and wife may file a joint petition or individual petitions. 11 U.S.C. √ü 302(a). Even when filing jointly, a husband and wife are subject to all of the document filing requirements of individual debtors. (The Official Forms may be purchased at legal stationery stores or downloaded from the internet at www.uscourts.gov/bkforms/index.html. They are not available from the court.)

The courts must charge a $245 case filing fee, a $39 miscellaneous administrative fee, and a $15 trustee surcharge. Normally, the fees must be paid towards the clerk of the court upon filing. With the court's permission, however, individual debtors may pay in installments. 28 U.S.C. √ü 1930(a); Fed. R. Bankr. P. 1006(b); Bankruptcy Court Miscellaneous Fee Schedule, Item 8. The quantity of installments is fixed to four, plus the debtor must make the final installment no later than 120 days after filing the petition. Fed. R. Bankr. P. 1006. For cause shown, the court may extend the time of any installment, provided that the last installment is paid not later than 180 days after filing the petition. Id. The debtor might also pay the $39 administrative fee and the $15 trustee surcharge in installments. If a joint petition is filed, only one filing fee, one administrative fee, and one trustee surcharge are charged. Debtors should be aware that failure to pay these fees may result in dismissal of the case. 11 U.S.C. √ü 707(a).

If the debtor's income is less than 150% of the poverty level (as defined in the Bankruptcy Code), and the debtor is unable to pay the chapter 7 fees even in installments, the court may waive the requirement that the fees be paid. 28 U.S.C. √ü 1930(f).

In order to complete the Official Bankruptcy Forms that make up the petition, statement of financial affairs, and schedules, the debtor must provide the following information:

1.A list of all creditors and the amount and nature of their claims;
2.The source, amount, and frequency of the debtor's income;
3.A list of all of the debtor's property; and
4.A detailed list of the debtor's monthly living expenses, i.e., food, clothing, shelter, utilities, taxes, transportation, medicine, etc.

For help with an Augusta GA chapter 13 bankruptcy , select a bankruptcy lawyer Augusta. A bankruptcy attorney Augusta GA could give you the help you need.

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How to Avoid Bankruptcy, and Get Ripped Off

Admin — Fri, 16 Oct 2009 15:05:42 +0000

First and foremost, I am not an attorney and I cannot give legal advice. However, I have spent 20 years approving and administering retail and mortgage credit. Doing so, I have helped many a customer tweak or repair their credit in order to qualify for the particular loan they have applied for. This often requires me to explain the fundamentals of credit repair as well as undo many of the misconceptions borrowers have picked up over the years.

One of the most egregious misconceptions people make in an attempt to avoid bankruptcy is the use of consumer credit counseling services (CCC). At best, these companies are a rip-off, and at worst they’re crooked. When you use (CCC) services it is almost always notated on your credit bureau by the credit repositories or by your individual creditors. When mortgage companies see “CCC” on your credit report it’s treated exactly like a bankruptcy.

The pitch

You can avoid bankruptcy – This is their primary pitch. They prey on people who are terrified of the stigma of bankruptcy. The truth is, CCC programs mimic chapter 13 bankruptcies without the protection that bankruptcy provides.
We can settle your debt for less – So can you, so can a bankruptcy attorney, plus they can give you protection from legal action from your creditors.
We take all of your payments and bundle them into one low payment – So can you, simply call the creditor and tell them “it’s bankruptcy or lower payments, which would you prefer”?
We work with all of your creditors for you and stop the harassing phone calls – The FDCPA (Fair Debt Collection Practices Act) gives everyone the right to stop the phone calls, simply Google the acronym above and follow the directions.
We will repair your credit – Yea, in seven years or longer. Bankruptcies stay on your bureau for 10 years, slow payments for seven. When you make partial payments to the creditors they report the slow payments each and every month.

This means that the credit bureaus will report your slow payments for as long as you are working the repayment plan, which can be years. Your credit will begin to heal ONLY after you have made the last payment. Bankruptcies are like a Band-Aid, once you rip it off the wound begins to heal.

We have secret tactics that only we can use – Bologna! (Expletive Omitted) Read the FDCPA and the FCRA for every “secret tactic” that is legal.

The truth

CCC services can’t do anything that you can’t do for yourself. They make money from their clients, (you), collection companies and your creditors. In fact, most creditors have become so annoyed with their “service” that they refuse to speak with CCC services, even when they have permission from you to do so.

Using CCC services will ruin your credit the same bankruptcy, take longer for your credit score to heal and cost you extra money. Not to mention this is all done without the protection from your creditors that bankruptcy provides. Meaning, the credit card companies can place a lien on your home or get a judgment against you anytime they like. Not so with bankruptcy.

In closing, I am not a proponent of bankruptcy; nor am I against it. I am simply looking at the situation from a pragmatic point view. Everyone’s credit situation is different and requires a unique approach when seeking to repair it. Just know this; you have all of the power to repair your credit at your fingertips without having to hire someone else to do it for you.

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