Debt Settlement

Dispute Credit Card Charges

September 24, 2015 by editor

We are led to believe that our finances are private. But with the blooming of advanced hacking techniques who exploit and take advantage of naivety, it is now possible for heightened levels of security to be peeled away like skin from an orange; revealing the juice within.

Hackers and scammers take a comprehensive approach when they play their fraudulent game. Like a network of organised criminals, they are skilled in what they do. But by shining a light on their dirty work; we make it a lot harder for them to carry out their operations.

They focus on major retailers such as P.F Chang’s, Target and Home Depot. By doing this, they can take thousands of numbers in one go. And on the black market, a credit card number isn’t cheap; they can be sold for up to $120.

Credit card issuers and merchants will mostly incur losses themselves, but that doesn’t count for the sheer velocity of fear and anxiety individuals have to endure because of these charges. Thankfully, there are ways to avoid getting into a mess like this in the first place.

Here are the steps you should take to dispute credit card charges.

Prevention

In order to collect honey from a bee-hive without getting stung, you need to wear a suit. Exactly the same can be said if you want to dispute credit card charges. In order to prevent fraud before it strikes, it is imperative to take these simple precautions, so that you are confident and worriless as you take honey from the hive.

Here are some important factors that you should consider:

The Phone

Only if it is a call that you initiated, with a person who you know and trust, should you share any account information. Any other calls, for example calls from an unknown number or any dodgy telesales company, you should never share information.

Privacy: Never leave your private account information where someone might see it; even if you think it will be safe. Each day, there are countless cases from people reporting that their account details were forged by people they deemed “close”.
Keep a record: In the case of theft, it is crucial that you have a record of account and telephone numbers from each card issuer, for a frame of reference.
Keep a close eye on your card: As long as your card is in use, and is out from a veil of safety, you should not let it out of your sight and should even cup it with your hands as much as possible.
Termination: Old cards that you no longer use should all be totally destroyed and disposed of.
Know what you’re signing for: Any forms or receipts that you are asked to sign should be checked attentively for legitimacy. For example, never sign a blank receipt.
Always check your statements: If you bank online, you should check your statements every few days or at least once a week. This way you can notice any fraudulent patterns or any inconsistencies.
PIN Number: Under no circumstances whatsoever, should you ever make your PIN Number publicly available. That is for your own use and yours only. Keep it safely hidden!

Reporting fraudulent debit and credit card charges

If the necessary steps haven’t been taken to prevent fraudulent behaviour and you have been compromised; or indeed, in the unfortunate case that you have still been compromised albeit having taken all the precautions, then you must act fast and report the crime the second that it happens.

In this case, the same principles apply for both credit cards and debit cards. Both scenarios should be acted on in exactly the same way. However, debit cards actually offer fewer protections in comparison to credit cards. For example, if you report fraudulent behaviour within two business days after you learn about the loss or theft you will be charged $50. And if you report the loss or theft more than 60 calendar days after your statement is sent to you, the liability is unlimited.

You should dispute credit card charges in exactly the same manner as you dispute debit card charges. However, the stakes aren’t quite as high when someone uses your credit card without your consent. Liability for unauthorized use of your credit card tops out at $50.

[Read: 4 Ways to Clean Up Credit Card Issues]

As previously suggested, though, the same manner of urgency should be applied to both debit cards and credit cards.

Here’s what you should do:

Contact your ATM or card issuer the second you notice any charges or withdrawals you didn’t make.
Send a certified mail letter to your bank and card issuer.
Take notes of your actions, including dates and contact information for any bank representative you have spoken to.
Follow up with your bank until the issue is resolved.

What Are Your Debt Relief Options?

March 10, 2014 by editor

How does being in debt affect you? Are you one of the less financially responsible people to shrug it off and worry about it later? Are does it worry you, stress you out and make you feel anxious about the next month’s payment that is coming due in the next few weeks. The problem is, once people fall into debt they often cannot lift themselves out again, they become tied down and only continue to fall into more and more debt as the interest rates increase and the bills slowly start to rise month by month it starts to feel hopeless. However, there are some great debt relief options that are sure to keep you a float in your time of financial burden.

Transfer your Balances

If you struggling with credit card debt and have multiple cards, a great debt relief option would be to transfer the debt from the card with the highest interest onto the card with the lowest amount of interest. This will drop your monthly payment by whatever the APR percentage rate is on each card. If you do not own another card you could apply for what’s called a “0% interest balance transfer card” which would keep your debt with no interest for 6-18 months. Once your debt has become interest free, every payment you make towards your card will reduce the amount of money you owe, rather than partially pay for monthly fees. If your debts are low enough and meet your financial ability, you could even get yourself out of debt by the end of your promotional period with interest free payments.

Home Refinancing

Check your home equity, if your balance is high enough, you could possibly refinance your house and use the money to repay your debts. If you are new to equity and do not know what it is, let me try to explain, your equity is the cost difference between how much money you owe on your house, and how much money your house is actually worth. Let me demonstrate, if you owe $150,000 on your mortgage, yet your house is actually worth $225,000, you possess $75,000 in equity. If you take a new mortgage out on your house for, let’s say, 90% you would then get $60,000 in return. You could then turn that money around and pay off whatever debts you have. Remember to be careful here, this will set back how soon your house will be paid off and will alter your future budget, so make sure to put in the proper consideration before choosing this debt relief option.

A Second Mortgage, or “The Homeowner’s Line of Credit”

If you decide not to refinance your home, another debt relief option you might consider is taking out a second mortgage on your house. This is also known as “Homeowners Line of Credit”. However, this also has to do with home equity. If you have not lived in your house for over 10 years you may have little to no equity at all. This is due to the high interest rates, in the first 10 years you are not really paying the balance down on the house. But, you’re paying interest and mortgage fees instead. If you have been in your home for over 10 years, or made a rather large down payment, you might have enough equity in the home to take out a second mortgage. This is definitely a good debt relief option as it will give you a boost in cash to pay off your debts.

Lower Your Monthly Spending

Many people find themselves in financial situations and often do not realize that it simply comes from their monthly spending habits, even if it’s the occasional bag of chips at the corner store throughout the week it could be adding up to over $100 a month. It is important to make a budget and keep track of how much money you spend on food, clothing and any other bills throughout the month. Once you have made a note to pay attention to wear your money is going every month, you can try to make some cut backs in certain categories in your budget. Although this is not quite a debt relief option, it is still a great way to help yourself out in financial times as it will take any extra money from your budget and put it back in your pocket.

Debt Settlement

Debt settlement, also known as debt negotiation, debt arbitration or credit settlement, is said to be the best debt relief option. If you are seriously in debt, say 5 or 6 months behind on payments, that’s when you should approach your creditors and offer to settle all your debt for something less than what you actually owe. Please note that there have been cases where 50 to 60 percent of debt has been settled this way.

Whatever debt relief option go with, make sure you understand every pro and con of it. It’s better to wait for another month than jump to a decision that would lead you to even more in debt.

What Are the Negative Effects of Debt Settlement?

October 1, 2013 by editor

There can be some very damaging on the overall health of your finances if you are considering debt settlement. There are some very damaging and negative effects of debt settlement.

The idea to solve your debts through debt settlement isn’t going to be easy; it can be very difficult and daunting prospect. This is why there are companies that are specializing in this type of debt settlement.

Debt settlement is about not paying your bills, bringing your case to the forefront of your creditors mind. You are stating by not paying that you are in a financial situation and you want help. The debt settlement is then agreeing with your creditors that you are only going to pay off a percentage of the debt that you owe and no more. This is the negative effect of debt settlement you are not going to pay the whole debt.

The Negative Effect of Debt Settlement

You might think that debt settlement is the way forward but you need to fully understand what you are planning on doing before you embark on this course of action.

One of the negative effects of debt settlement is the damage that it will do to your credit rating. It will not make it look poor for a short period; it will do serious damage for a number of years. It is the second worst thing that you can do to your credit rating, the first is bankruptcy. There are two reasons for this:

You are not paying your monthly commitments so it shows accounts are in default. This means that you have not paid your bills and you are behind in the payments.
You are increasing the debt with late payment fees and interest.

Both of these add up to a significant proportion of what is calculated when your credit report is created.

There are some pitfalls that you need to be prepared for if you are not put off by the negative effect of debt settlement.

The companies can prolong the time that it takes to form a settlement figure. This means that more interest and late payment fees are added. During this time you are not even allowed to make minimum payments. If you have a company working for you this can be made to go quicker because they will have a standing in the financial world and the settlement is often reached in a short period of time.
With the figure of money that you owe increasing every month, this could put the figure of settlement higher. There is no guarantee that the figure is going to be in the region that you are hoping for.
You will be pestered by calls from your creditors asking for money and payment. This pressure can be eased if you are dealing with a debt settlement company; they get the calls and not you. If you do try to do this by yourself the calls are known to be nasty and threatening.
If the debt that you get forgiven is more than $600 then you will need to think of the tax implication. This money will be seen as an income and you can be liable for taxes.
The debt will not be marked on your credit report as paid or even paid in full, it will have the terms ‘paid-settled’ or ‘charged – off settled’. These are clear indicators that you have used the debt settlement option and can have a negative impact on your credit file for the next seven years.

Debt Settlement Might Be the Best Option If

It might be the only option to try before going bankrupt. It is important to try all options because bankruptcy is not an easy situation to rise from.
If you do not plan to use credit in the near future and therefore have no care about your credit score then this might be a great option.
If you have tried to consolidate your debts and you either couldn’t make it work or you were refused any consolidation loans then this might be one of your last options to try.
If the debt that you owe is a lot then this might be the only way that you are able to be debt free in five years’ time. This will give you time to rebuild your credit file in the future.
If you need to resolve your debt problem fast and are fully aware of the consequences then this option could be for you.

It is important that before you look towards debt settlement that you fully understand what you are going into before you start the process, because it is not going to be easy and it will have implications for a long period of time. It is therefore vital that you only proceed with all the information possible.