Tag: credit card debt

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Household Credit Card Debt Still on the Rise

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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.

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.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Tips to Quickly Pay Off Credit Card Debt

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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.

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:

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

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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.

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 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.

 

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

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

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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

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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.

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, Debt Relief, Timothy Kingcade Posts

Lawsuit Alleges Orlando law firm violated rules on bankruptcy fees

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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.

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.

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

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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:

  1. 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.
  2. 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.
  3. 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.

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

Americans Underreport Credit Card Debt by $415 Billion

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A recent study conducted by NerdWallet showed that consumers are underreporting their credit card debt. In December 2013, lenders reported approximately $683 billion in outstanding credit card debt, according to the Federal Reserve Bank of New York. However, Americans only reported having $268 billion in credit card debt.

The $415 billion discrepancy in reported credit card debt was far greater than any other type of debt, including student loans and mortgage debt. The reasoning is likely due to the stigma surrounding credit card debt, according to NerdWallet.

According to the study, 70 percent of Americans think credit card debt has a more negative stigma attached to it than any other type of debt. Mortgage and student loan debt is often considered “good” debt and credit card debt is considered “bad” debt. As a result, consumers may be underreporting credit card debt because they are ashamed of the amount of credit card debt they have. The survey also found that 35 percent of Americans would be embarrassed to tell others they have credit card debt, significantly more than any other type of debt.

How to pay off your credit card debt

Credit cards typically have the highest interest rates among other types of debt, therefore it is important to pay them off as quickly as possible. The first thing you need to do is figure out exactly how much you owe. You can do this by logging into your credit card account’s website. While you are logged in, note the balance, interest rate, minimum payment and due date.

Once you have determined how much you owe with each credit card account, make the account with the highest interest rate your top priority. Pay any extra that you can each month on that account. Once it is paid off, move on to the account with the second highest interest rate, and continue paying off each account by the highest interest rates.

Click here to read more on this story.

If you have any questions on this topic or 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

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Americans Borrow No Matter the Economy

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The Federal Reserve recently released data that indicated that American’s borrowing habits are excessive whether the economy is booming or hurting.  Over the past decade, credit card debt has gone from $1.02 trillion in 2008, down to $835 billion in 2011 and back up to $935.6 billion by the end of last year.

Americans between the ages of 18 and 65 have an average of $4,717 in credit card debt. The average interest rate is 15 percent, according to creditcards.com. Therefore, if a credit card user makes a minimum payment of $189 per month, it will take more than ten years to pay off a debt of $4,717. Ultimately, the debtor would pay a total amount of $22,869, a cost of $18,155 for a very small loan.

A study released by the Boston Fed examined American credit card debt and found that the biggest reason Americans have such high debt is due to the availability of credit.

The study also showed that only 35 percent of credit card users do not carry a balance. This means they pay off their bill every month and only use their cards for convenience. The other 65 percent of credit card users are “revolvers,” meaning they do not pay their balance in full so the debt revolves. Revolvers tend to see credit limit increases as an invitation to spend more.

Many credit card users are reeled in when companies offer free teaser years that come with as much as $600 worth of miles or hundreds of dollars in cash back as incentives to sign-up and spend. Studies show that credit card debt typically starts in a debtor’s 20’s. Often times the debtor is not earning very much at the time and the availability of funds through credit essentially amounts to extra wealth and reduces the need to save. Although the habit typically starts early in adult life, credit card debt follows most Americans into middle, even old age.

Keep in mind; there are incentives to breaking your credit card habits. According to the Federal Reserve, paying off your credit cards comes with a return that averages 14 percent. This means simply paying off your credit card debt is the best investment you can make.

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 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.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Credit Card Debt on the Rise

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While the economy indicated signs of financial hardship in November 2015 with low spending, consumers were spending more confidently in December and January with credit card debt increasing at its fastest pace in more than seven years. Outstanding consumer credit, which includes all credit outside of mortgages, increased by an annualized $21.27 billion in December. Economists had only predicted consumer credit would rise $16.5 billion.

Revolving credit, which is mostly credit card debt, rose by $5.84 billion after rising $6.36 billion in November. Since last year, revolving credit rose 5.1 percent. This is the fastest gain since October 2008.

So where were consumers using their credit cards in the fourth quarter? Amazon.com accounted for a vast majority of credit card use, bringing in 51 percent of the total retail sales growth in the fourth quarter. The online retail giant also accounted for 42 percent of total retail sales growth for the entire year. However, companies such as Apple iPhone indicated sales were flat worldwide in December. Apple also forecasted its first yearly decline in sales in 13 years.

Non-revolving credit, including auto and student loans, increased $15.43 billion, up from $7.66 billion in November. However, economists anticipate auto sales will plateau or fall in 2016 from fourth quarter levels.

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 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.