credit card debt Archives - Page 20 of 23

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

5 Times you should Never Use a Credit Card

Posted on August 29, 2016by Admin

Using a credit card responsibly is an excellent way to boost your credit score, build your credit history, track spending, even take advantage of cash-back and other reward programs. However, if you are unable to pay your bill off every month the high interest rates will cost you.

Here are five times you may want to put the credit card away and opt for another method of payment:

Paying for a BIG expense– Moving to a new city, remodeling your home or going on a vacation are all purchases you will want to save up for ahead of time. Using more than a third of your available credit on a card can have a negative effect on your credit score.

To consolidate credit card debt– If you are trying to consolidate all of your consumer debts into one payment, the best option depends on your credit score, how much debt you have and, most importantly, your ability to pay down the debt. If you cannot reasonably pay off your consumer debt in five years, most experts advise debt reorganization or bankruptcy. If your credit score is average, you can tap into your home equity or take a loan against your retirement account or life insurance policy. However, the consequences of defaulting on these loans come with severe penalties.

To fund emergencies– In an emergency situation, a credit card should be your last resort. If you do not have an emergency fund, start one today. Budget to have the money automatically transferred from your checking account into a savings account- even if it is only $50 a month. This can add up over a year.

To pay for your wedding– Do not start your married life in debt. Taking out a personal loan to help pay for a portion of the wedding expenses is a smarter option because these come with fixed interest rates, making it easier for the payments to be factored into your monthly budget. Depending on your credit, these can come with lower interest rates and allow you to pay overtime.

To pay your taxes– Avoid using a credit card to pay your taxes. It is better to take from savings or utilize the IRS installment plan option to avoid paying a fee on top of your tax bill. Vendors that the IRS authorizes to accept card payments charge a convenience fee of 1.87% to 2.25% of the amount you owe. E-filing software companies charge even higher rates for credit card payments.

If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Related Resources:

http://www.usatoday.com/story/money/personalfinance/2016/08/20/5-times-you-shouldnt-use-credit-card/88945872/

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

The South has the highest rates of personal bankruptcy filings in the country

Posted on August 25, 2016by Admin

Personal bankruptcy filings fell to levels not seen since before the Great Recession of 2007, according the American Bankruptcy Institute. However, this is not the case for some parts of the country. Recent federal data from U.S. courts reveals the median bankruptcy rate among the 587 counties examined was 224 filings per 100,000 residents. Among the 50 states and Washington, D.C., the median bankruptcy rate was 226 filings per 100,000 residents.

Six of the 10 states and eight of the 10 counties with the highest personal bankruptcy filings were in the South. Many of the areas had lower to median annual incomes. Eight of the 10 states with the highest rates of bankruptcy filings had annual household incomes lower than the 2014 U.S. median of $53,657.

Another downside, states with the highest bankruptcy rates offer the least amount of protections for consumers. For example, Alabama and Kentucky, allow debt collectors to seize nearly everything a debtor owns, according to the National Consumer Law Center.

These are the states with the highest rates of personal bankruptcy filings:

Tennessee, 553 bankruptcy filings per 100,000 residents

Alabama, 529 bankruptcy filings per 100,000 residents

Georgia, 483 bankruptcy filings per 100,000 residents

Illinois, 432 bankruptcy filings per 100,000 residents

Utah, 392 bankruptcy filings per 100,000 residents

Indiana, 387 bankruptcy filings per 100,000 residents

Mississippi, 361 bankruptcy filings per 100,000 residents

Kentucky, 345 bankruptcy filings per 100,000 residents

Arkansas, 344 bankruptcy filings per 100,000 residents

Ohio, 322 bankruptcy filings per 100,000 residents

While seeking relief through bankruptcy may not have been your first choice, it may be your best financial strategy, when compared to the alternatives of wage garnishment, lawsuits and endless collection calls. In addition, depending on the type of bankruptcy filing, there is no more overwhelming debt. The majority of personal bankruptcy filings are for Chapter 7, which erases most unsecured debts, such as your credit card debt and medical bills.

Related Resources:

http://www.csmonitor.com/Business/Saving-Money/2016/0816/The-South-has-the-highest-bankruptcy-rates-in-the-country

Bankruptcy Law, Credit, Debt Relief, Florida Bar, Timothy Kingcade Posts

8 Things Debt Collectors Won’t Tell You

Posted on August 8, 2016by Admin

Debt collectors often use extreme and dishonest measures to try to collect on debts. However, there are a number of things that they are not likely to tell you, and knowing these things can make all the difference in resolving your debts.

Below are eight things debt collectors are not telling you:

Some of their threats carry no weight. Oftentimes, debt collectors use empty threats such as, “We are going to inform your creditor that you are refusing to pay this bill.” However, your creditor already knows you are not paying the bill, which is why the bill was sent to a collection agency.
If you tell them not to call during work hours, they must comply. According to the Fair Debt Collection Practices Act, debt collectors cannot continue to call you while you are at work, if you tell them not to. However, the 2011 Annual Report to Congress about the Fair Debt Collection Practices Act complaints proved that 17,008 complaints were filed in 2010 related to debt collection calls to consumers at work. This number is up from 11,991 complaints the previous year.
They cannot talk about your debts to others. Debt collectors are only allowed to discuss your debt with you, a co-signer, your spouse or your attorney. According to the Fair Debt Collection Practices Act, debt collectors can only contact “third parties” to locate you.
Your debt may be stale. Each state has its own statute of limitations that makes debt of certain ages not collectible. However, some debt collectors continue to target borrowers to collect on old debts.
Debt collectors are under pressure to collect, just like you are to pay. Most collectors work on sliding scale commissions. This means that the quicker they collect money from debtors, the higher their commission.
They cannot go after your possessions unless they sue you. Debt collectors must sue you before they can go after your property, including money in your bank account. Even threatening to sue you to collect a debt may be illegal if the collector has no intention of doing so.
Paying off this debt will not boost your credit ratings. When a debt is sent to collections, it will remain on your credit report for seven and a half years from the date you fell behind with the original creditor. Collectors will often tell you they will “update your credit report to paid in full status.” However, the change will not likely affect your credit report.
You probably do not have to pay your deceased relative’s debt. You are generally not responsible for the debts of relatives who have died unless you were a co-signer of the debt or the debt belonged to your spouse who died.

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Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Household Credit Card Debt Still on the Rise

Posted on August 5, 2016by Admin

Financial experts believe the average household credit card debt will reach the “tipping point” of financial sustainability by the end of 2016. During the first quarter of 2016, Americans paid down approximately $26.8 billion in credit card debt; however, this is the lowest amount paid down in one quarter since 2008. By the end of 2015, credit card debt had reached $917.7 billion, up $71 billion from 2014. Analysts predict that national credit card debt will exceed $1 trillion dollars by the end of 2016.

A study conducted by CardHub found that the average American household’s credit card balance was more than $7,500. The amount is approximately $831 less than what the study considers the “tipping point” of financial sustainability.

Another study conducted by Dun & Bradstreet found that on average, people spend 12 to 18 percent more when they use a credit card, rather than cash.

The number of cards the average American uses is also on the rise. In 2015, data from Experian revealed that the average number of cards borrowers had was 2.24 cards per person, up from 2.18 cards per person in 2014.

One of the factors financial experts attribute to the rise in credit card debt is the lack of emergency funds. Many Americans are using credit cards for unexpected expenses without reducing their expenses, rather than using credit cards as a substitute for cash.

Click here to read more on this story.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Tips to Quickly Pay Off Credit Card Debt

Posted on July 26, 2016by Admin

In 2015, the average American had approximately $15,762 in consumer credit card debt and the United States as a whole had more than $733 billion. Credit card debt was the fourth largest type of debt in the country, following student loans, auto loans and mortgages. However, most consumers retain this debt for many years and end up racking up thousands of dollars in interest. This typically occurs because consumers prioritize other payments such as mortgage payments, student loan payments, hospital bills and car payments, and therefore only make the minimum credit card payments each month.

Below are some tips to help you quickly pay off $10,000 in credit card debt.

• Find out your total balance. The first thing you need to do is find out your total amount of debt, totaling all of your consumer credit cards.

• Stop the interest. The next thing you need to do is look for a card that is offering a long lasting “0% intro APR balance transfer” promotion. Next, transfer your balance to this card. If you have more than one card with a balance, try to consolidate all of your credit card balances to the same card offering 0% interest. In many cases, interest accounts for as much as 75% of your monthly payment! According to NerdWallet, the average household pays $6,658 in interest per year in various debts.

• Power through the balance. After you have transferred your balance, it is important to take advantage of the interest-free period of your new card. Continue to make the same payments you made before and your balance will start shrinking much faster.

Related Resources:

https://www.lendingtree.com/info/powerful-2-step-method-pay-off-credit-cards?esourceid=6164156&cchannel=bd&csource=cnn-money&siteid=CC-pay-off-10k-hp

https://www.nerdwallet.com/blog/credit-card-data/average-credit-card-debt-household/

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Why Chapter 7 Bankruptcy should be Your First Option and Not Your Last Resort

Posted on July 25, 2016by Admin

Many Americans turn to debt relief assistance options when they are struggling with medical, credit card or other types of unsecured debt. However, according to the Huffington Post, nearly half of all programs aimed at helping you with your debt problems, fail to achieve the results they promise. These programs include credit counseling services, debt settlement programs, etc. Even those who have success with such programs usually end up with extremely high, consolidated payments for many years and accrue thousands of dollars in interest.

Filing for bankruptcy can you save time and money when you are in financial distress. Here is an example that shows the money and time debtors can save if they choose to file for bankruptcy, rather than seek debt relief assistance. Imagine that you currently have $22,000 in unsecured debts, such as credit cards. You have recently lost your job and can no longer afford each of the individual payments; therefore you choose to consolidate your credit cards into one monthly payment with the help of a credit-counseling agency. Your monthly payment is now $418 per month for the next five years. Once you pay off your debt at the end of the five years, you have paid roughly $25,000 including interest. However, if you put the same payment of $418 per month into an IRA for five years with an average return of 9.74%, you would not only have saved yourself $3,000 in interest but you would also have approximately $32,000 saved for retirement.

Filling for Chapter 7 bankruptcy can eliminate years of extremely high monthly payments and ongoing stress. The process of filing bankruptcy can take as little as 90 days and the total cost is typically between $1,500 and $1,800.

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Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Credit Card Borrowing Surges in U.S. – More defaults to come?

Posted on June 16, 2016by Admin

The U.S. economy is growing steadily, but credit card lending is growing double that- rising more than 5% over a year earlier and accelerated to 6% in March and April, according to Federal Reserve data.

This is the fastest credit card debt has grown since card lending declined during the 2009 recession. Since Americans are not earning much more since that time- will delinquencies, charge-offs and bankruptcies begin to rise in another year or two?

Bad mortgages were at low levels in the mid-2000s, after numerous new loans were made, but before they had a chance to default, making loss measures a poor indicator of the 2008-09 credit crisis. Loan-loss rates measure the highest, not when bad loans are made, but when the loans stop getting paid. This can take a year or two from the time the bills are accrued.

Loan losses can be masked by aggressive new lending, and exaggerated at banks that stop making new loans, allowing loss rates to mount. The most aggressive and fastest growing major card lenders include Capital One, Synchrony (formerly General Electric Finance), and Wells Fargo. Citi, Chase and other bigger lenders are expanding less aggressively.

For the nine dominant U.S. credit card banks, which control 70% of the Visa-MasterCard-American Express-Discover-Chinapay market in the U.S., average charge-offs in early 2016 were 3.13% of annualized average loans.

Click here to read more on this story.

If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Auto and Credit Card Delinquencies on the Rise in the First Quarter

Posted on May 17, 2016by Admin

Delinquency rates for auto loans and credit cards increased drastically in the first quarter of this year, according to TransUnion. The serious delinquency rates for auto loans (60 days or more past due) reached 1.12 percent in the first quarter, marking the first time the figure exceeded 1 percent in the first quarter since 2011.

Serious delinquency rates for credit cards (accounts that are 90 or more days past due) increased to 1.47 percent in the first quarter. This is highest first-quarter amount since the first quarter of 2013, when serious credit card delinquencies were 1.51 percent. First quarter 2014 and 2015 delinquencies remained stable at 1.37 percent. Serious credit card delinquency rates, however, continue to remain below the average first quarter rate of 1.52 percent since the beginning of 2011, according to TransUnion.

The year-over-year growth in credit card balances is at a record high. The total balance for credit cards increased 6.4 percent to reach nearly $644 billion in the first quarter, also marking the highest year-over-year growth observed in more than six years.

The total balance for credit cards was $605 billion in the first quarter last year, according to TransUnion. Credit card debt accumulation increased 146 percent from the third quarter to fourth quarter 2015, or $21.3 billion to $52.4 billion, respectively, according to CardHub. The delinquency rate from the third to fourth quarter increased from 2.18 percent to 2.23 percent, respectively.

Click here to read more on this story.

Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Lawsuit Alleges Orlando law firm violated rules on bankruptcy fees

Posted on April 29, 2016by Admin

The KEL law firm is facing a lawsuit alleging it routinely allowed clients to pay bankruptcy legal fees using credit cards, a violation of bankruptcy law. Credit card purchases are considered new debts and new debts are prohibited in the days before filing for bankruptcy and during the bankruptcy process. That is because bankruptcy courts often erase a filer’s credit card debt, which means the nation’s banking system would be on the hook for KEL’s legal fees.

The suit, which seeks class-action status, contends that KEL “uses standardized procedures when attempting to collect attorney’s fees by charging credit cards prior filing Chapter 7 bankruptcy.” It seeks the return of all bankruptcy fees paid by credit card—the amount of which is cited at $1,700 in the suit—and $1 million in punitive damages.

The lawsuit states an Orlando resident paid his bankruptcy fees to KEL using a Discover credit card and a BJ’s credit card. During the course of the filing, the debtor decided to switch to a new law firm, which noticed the prior fee payment on the credit cards to KEL. Jacksonville law firm Mickler & Mickler filed the proposed class action on behalf of the debtor.

Related Resources:

http://www.abajournal.com/news/article/ex_client_sues_law_firm_says_it_allowed_bankruptcy_fees_to_be_paid_by_credi

http://www.orlandosentinel.com/business/brinkmann-on-business/os-kel-firm-bankruptcy-fees-lawsuit-alleges-20160420-story.html

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Tips for Applying for a Credit Card after Bankruptcy

Posted on April 1, 2016by Admin

Filing for bankruptcy doesn’t mean you are shut off from new credit. Creditors look at multiple factors when determining credit eligibility. For example, your income and the time since you received your bankruptcy discharge.

If you are looking to rebuild your credit post-bankruptcy, a secured credit card is a good place to start. Secured credit cards are designed specifically for people trying to improve their credit. They are different from normal credit cards in that they require you to put down a security deposit, usually a few hundred dollars. Your deposit typically equals your credit line: For example, if you make a $400 deposit, you will have a $400 line of credit. The deposit protects the issuer if you do not make your payments. That makes secured cards a relatively safe bet for lenders extending credit lines to people with lower credit scores.

Those individuals who file for bankruptcy may receive an influx of credit card offers soon after. Proceed with caution. These cards will likely have low limits and high interest rates. The best way to qualify for a credit card post-bankruptcy is to improve your credit score. Here are some immediate steps you can take to improve your credit score after bankruptcy:

Make sure all discharged debts are cleared from your credit report. If your credit reports are still showing delinquent accounts after you receive your bankruptcy discharge, this is likely affecting your credit score in a negative way. You are entitled to a FREE credit report every year from the three credit bureaus.
Get your noncredit finances in order. Although many bankruptcies are the result of medical bills, divorce, job loss or other unavoidable debts, it is also important to remember the fundamental problems with spending, saving and budgeting. Addressing these issues before applying for new credit can help you overall.
Build credit. Once your finances are back in order, it is time to consider strategic credit building via a secured credit card or credit-builder loan.

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