credit card debt Archives - Page 24 of 25 - Kingcade Garcia McMaken, P.A. Bankruptcy Attorneys

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

How to Get Rid of Holiday Debt FAST

Posted on December 29, 2015by Admin

We all have a vision of what constitutes “the perfect holiday.” For many of us, it means countless presents under the tree, our children’s smiling faces on Christmas morning and that perfect meal with our family and loved ones all gathered around the table. For some of us, making that vision a reality means putting it on credit cards.

If that was you this year, you’re probably wondering the next steps to take before the bills arrive and the interest starts mounting.

Here are some immediate steps you can take to help manage holiday debt in the New Year:

Make January and February lean months for spending. With the plentiful holiday season behind us, it’s a good idea to start reeling in the spending and extravagance. That doesn’t mean starve yourself, but it does mean sacrificing on splurges you would normally enjoy (i.e. – dinners out, visits to the salon, shopping, vacations, etc.)

Channel savings directly into those big credit card payments. Take a look at all of your credit card bills and determine which one has the highest interest rate. Make the biggest payment you possibly can afford towards that card, while still allotting enough money to pay your other bills and cover monthly expenses.

Look for zero-interest balance transfers. BEFORE you send off that big payment, research credit card offers for balance transfers that allow you to pay 0 percent interest on the transferred balance for a certain period of time. Just make sure you get the transferred balance paid off before the zero interest offer expires.

Sell unwanted items. You will likely find that after the dust settles, you have some unwanted items and gifts around the house you no longer use or want. Utilize Craigslist and eBay to sell these items and earn some extra cash. This money can go towards making bigger payments towards your high-interest credit cards.

Start a savings plan for next holiday season. The best time to start saving for the next holiday season is right now! If you save just $10 a week (the equivalent of a lunch out or a week’s worth of Starbucks runs) for 50 weeks, you will have more than $500 saved for next year’s shopping. If you save $20 a week, you will have over $1,000 set aside for holiday shopping next year. The easiest and most effective way to do this is by setting up weekly automatic transfers through your bank.

Make the holidays more realistic. Discuss sensible downsizing when it comes to purchasing gifts next year. Have a budget for gifts and stick to it. Move to drawing names with family members for gift giving purposes (i.e. – Secret Santa) and discuss arrangements that reduce the challenges on travel for everyone. The spirit of the holiday season should be about togetherness and giving thanks for all of the blessings we have- not something that causes you to go into debt.

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

How a Rise in the Federal Funds Rate Could Hurt Your Credit Card Debt

Posted on December 16, 2015by Admin

As many consumers turn to credit cards this holiday season to fund gifts, vacations and dinners out- a Federal rate hike could be the essential “anti-holiday” gift. The annual percentage rate is expected to increase on most credit cards and if it does, it will affect many card holders on their next bill.

That’s because the hook for most variable-rate consumer borrowing, whether credit cards, adjustable-rate mortgages, or home equity lines of credit, is the prime rate. And that rate moves with the federal funds rate. Today, prime is 3.25 percent, and card issuers add a certain percent on top of it to set the annual percentage rate (APR).

This is a non-issue for consumers who pay off their balances. However, for those who carry a balance month-to-month, it will affect the entire balance, not just new purchases. If this turns into a series of rate hikes, it could make paying off a big balance take longer and cost more.

In a recent report, a quarter point-rise in the federal funds rate would cost cardholders $1 billion annually, and a full percentage-point hike almost $6 billion, according to the Consumer Financial Protection Bureau.

The good news? In most cases, if you got a promotional rate on a balance transfer, that rate is fixed. So anyone who has taken advantage of such offers would not see their transferred balance affected by rate increases until the promotional period ends.

If you are carrying a large balance on a card with a double-digit APR, there are still opportunities to transfer balances at a zero percent rate, fixed, for a year or more.

Consumers are advised to call their credit card company to see if they qualify for a lower rate. But make sure your credit is the same or better than it has been in the past. If issuers find your financial situation has changed for the worse when they check your record, they can cut your credit limit, or even decide they do not want you as a customer anymore.

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, Student Loans, Timothy Kingcade Posts

What happens to your debts when you die?

Posted on December 1, 2015by Admin

Your debts become the responsibility of your estate. When you pass away, any debts you leave behind could take from the assets you had hoped to leave your loved ones. In some cases, family members can even be responsible for your debts. This is the reason many people purchase life insurance- not only to leave their loved ones something when they pass, but also to take care of any outstanding debt and final expenses.

Mortgages and home-equity loans

If the property has a mortgage, the lender does have some protection, at least up to the value of the property. However, federal law states that lenders cannot force the joint owner to pay off the mortgage immediately after the co-owner dies. This also applies to any relative who inherits the home and lives in it. This means the family member or co-owner can simply take over the monthly mortgage payments. If there is an outstanding home-equity loan, a lender can force the person who inherits the home to repay the loan immediately, which could result in the home being sold.

Auto loans

If the vehicle is not paid in full, the lender has the right to repossess the car. But typically, whoever inherits the car can just take over the payments. It is unlikely the lender will take action.

Credit cards

When the estate runs out of assets, the credit card companies are out of luck. This is due to the fact that credit card debt is not secured by assets the way mortgages and car loans are. Any joint account holder would be responsible for the bill, but people who are simply authorized users of the card would not be.

Student loans

Lenders do not have any recourse if the estate does not have assets to repay other unsecured obligations, like student loans. Even if your relatives are not responsible for your debts, collection companies can still legally call to discuss the debts to find someone who is authorized to pay them, according to the FTC. It is important to know, debt collectors cannot mislead family members into thinking they are responsible for the debts.

Caveats

These are the circumstances in which spouses or other people would be responsible for your debts. These include:

They co-signed on a loan;
Are joint account holders;
Are spouses in community property states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin.

What is protected?

Creditors typically cannot go after your retirement accounts or life insurance proceeds. However, if the life insurance beneficiaries you named are no longer living, your death benefit may go into your estate and then be subject to creditors. That is one reason why it is important to make sure your policy names the proper beneficiaries.

Click here to read more on this story.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Five Things to do after Bankruptcy

Posted on November 12, 2015by Admin

So you recently filed for bankruptcy and received your discharge, what should you do next? Whether you filed for Chapter 7 (a simple and straightforward elimination of debt bankruptcy) or a Chapter 13 (a debt repayment bankruptcy), there are certain things you should do once your case is finalized.

Collect and preserve all paperwork from your case. You should have received a full copy of your bankruptcy petition from your attorney, which is 40-50 pages of detailed financial information – including the facts about the debts and assets involved in your case. You should have also received a notice of bankruptcy filing directly from the court, which shows the deadlines that affected your case. The court should have also sent you a copy of your discharge order entered by the bankruptcy judge. It is important to have these because some lenders want to see a copy of the bankruptcy papers when considering you for new credit. This is especially true for mortgage loans.

Monitor your credit reports regularly. Credit reports from the three major credit reporting agencies can be obtained for free once a year- and it’s important to know what your creditors are saying about you. Wait approximately three to six months after your bankruptcy has been discharged to do so. It may take several billing periods for creditors to update their accounts, and many creditors and lenders will stop reporting to the credit bureaus altogether after a bankruptcy. It is important to do this because you want to make sure all of your discharged debts from the bankruptcy are being reported to the credit bureaus with a zero balance, so it does not count against you as outstanding debt, which can hurt you if you are applying for new credit.

Start a budget and review it regularly. A main focus after bankruptcy is rebuilding your credit and your budget. Create a basic budget to understand your expenses and take some time every week to see where you are at. Remember the Means Test from your bankruptcy paperwork that compared your income and expenses over a six-month period to standards set by the Census Bureau and the IRS. This test was meant to ‘filter out’ those who had the means to pay their debts, but who were living an extravagant lifestyle financed on credit cards. This is often considered an urban myth, as statistics reveal that a very small percentage fit into “the extravagant lifestyle” category. Most bankruptcies are the result of unforeseen medical expenses, a job loss, divorce or birth of a child.

Start an emergency fund. This goes hand in hand with putting together a realistic budget. When creating your budget, a small part of your income should be set aside for the unexpected. You can begin saving for an emergency fund in less than one month. If you do this every month, you will be amazed at how much it grows. You can start putting a portion of it aside for retirement or your child’s college fund. This is important to do because it will prevent you from obtaining new debt and repeating the cycle.

Consider new credit. Don’t let yourself get carried away with this one. Start with a small credit limit; monitor your charges and budget so you can pay the balance in full each month. There is a world of difference between having good credit and a heavy debt load.

Bankruptcy Law, Credit, Timothy Kingcade Posts

The WRONG Reasons to File Bankruptcy

Posted on April 20, 2015by Admin

Although you may be receiving unwanted collections calls and falling behind on some bills, bankruptcy may not be the best option for you. There are certain types of debt which bankruptcy cannot erase. For example, back child support, alimony obligations, student loans and certain tax debts are non-dischargeable in bankruptcy.

Below are four reasons you should NOT file for bankruptcy:

1. You cannot make small payments on unsecured debt. Unsecured debt consists of most credit card debt and medical bills. In other words, it is debt that the lender has allowed you to run up without asking for a collateral in return. If you default on unsecured debt, the lender has nothing to repossess. Most consumers think that failing to make these payments will result in wage garnishment or other significant consequences. However, most lenders cannot take action unless they sue you. This can oftentimes be a lengthy process, providing you time to come up with the payments. If the amount you owe is small, the lender may write it off as uncollectable, rather than taking legal action. There are also options such as the negotiation of your interest rate or being placed on a realistic payment plan.

2. You want debt collectors to stop contacting you. The Fair Debt Collection Practices Act (FDCPA) requires debt collectors stop contacting you if you ask them. You must send the collection company a certified letter requesting this. After you have taken such action, it is against the law for the collection company to contact you, except to let you know they are either going to take legal action against you or stop their collection efforts.

3. Most of your debts are from recent income taxes, court judgments, child support payments or student loans. These are some of the debts that are oftentimes non-dischargeable in bankruptcy court. Filing for bankruptcy will not relieve you of these type debts.

4. You do not have any assets or income outside of Social Security, unemployment or welfare. Creditors cannot garnish your Social Security income, unemployment or welfare, even if they sue you. It is not necessary to file bankruptcy if you do not have an income that creditors can take or assets they can seize.

Click here to read more on the wrong reasons to file bankruptcy.

If you are in a financial crisis and are considering filing 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, Timothy Kingcade Posts

Five Store Credit Cards to Avoid

Posted on August 8, 2014by Admin

According to a survey of 61 major retail credit cards by CreditCards.com, retail credit cards are becoming debt traps for consumers. Many of these cards have an average APR of 23.23%, compared with 15.03% for other credit cards. This means a consumer who spends $1,000 on a retail card, and made only the minimum payments, would spend more than six years repaying that balance and end up paying a total of $1,840 for the $1,000 item. That is equivalent to an 84% markup!

Retail credit cards sometimes have benefits that may be worth it to consumers who frequently shop at the store and pay the balance off in full every month. Many of these cards come with perks like store discounts, special sales and rewards for cardholders. But miss one payment one month and you run into trouble on most of these credit cards.

Below are the retail credit cards to steer clear of, according to the CreditCards.com survey:

1. Zales has up to a 28.99% APR.
2. Office Depot Personal Credit Card has a 27.99% APR.
3. Staples Personal Account has a 27.99% APR.
4. My Best Buy has up to 25.24% and 27.99% APR, depending on your credit score.
5. My Best Buy Preferred has a 25.24% and 27.99% APR, depending on your credit score.

Bottom line: Retail credit cards are a bad idea for anyone who does not pay their balance off in full every month, because the interest rates are so exorbitant.

If you are in a 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, Foreclosures, Timothy Kingcade Posts

When should you consider bankruptcy?

Posted on July 29, 2014by Admin

Many consumers struggling to pay off credit card debt or medical bills wonder when the right time is to file for bankruptcy- or if bankruptcy is even the best option for them. It makes little sense to continue struggling against a mound of debt you are not even making a dent in with monthly payments– or maybe you are no longer able to afford those payments. A good rule thumb is, if it would take you five years or more to repay what you owe, you should consider filing for bankruptcy. Why five years? Because that is how long you would be required to make payments under a Chapter 13 repayment plan.

However, most consumers qualify for Chapter 7 bankruptcy, which is typically faster (takes approximately three to four months, as opposed to five years) and erases all of your credit card debt and medical bills. If lower interest rates would help you pay off the debt within five years, consider scheduling an appointment with a credit counselor associated with the National Foundation for Credit Counseling (www.nfcc.org). These nonprofits can set you up with debt management plans that may offer you lower rates on your credit card debt.

Many people feel an obligation to pay what they owe, even if in reality they will never be able to pay off the debt. Bankruptcy laws allow individuals to gain a fresh start, so they can take care of themselves and their families. If you are behind on your mortgage payments, filing for Chapter 7 bankruptcy can allow you to stay in your home and catch up on your payments or negotiate with your lender. This is all thanks to the automatic stay which immediately goes into effect and prohibits your mortgage lender from foreclosing on your home.

Bankruptcy Law, Timothy Kingcade Posts

Find out what your Debt is really Costing You

Posted on June 6, 2014by Admin

Thanks to the CARD Act, those who carry credit card debt are reminded on their monthly statements just how long it will take to pay it off in full. For many consumers, this is not a pretty picture. Most do not realize that by being in debt, purchases you make on those credit cards are actually costing more than what you pay the merchant. It’s a vicious cycle. Each dollar you do not pay over the fixed minimum payment ends up costing you much more in the end.

For example, if you have a $1,000 credit card balance at a 20 percent APR and you plan on making a payment of $20 a month until it’s paid off, it will take you just over nine years and you will have paid approximately $1,168 in interest. The key is to make more than just the minimum monthly payment. Even low-interest rate debts like student loans, which can be extended out 30 years, by making only the minimum payment you are increasing the time you carry those balances because of the compound interest.

Here’s some advice…
• If possible, start paying off the debt in full, beginning with those cards that have the highest interest rates. Also, paying off the smallest debts first can give you motivation to tackle the larger debts.

• Do not let purchases made on credit cards become invisible spending. Switch to a debit card and sign up for balance notifications and alerts on your phone and email.

• Consolidate credit card balances. If you qualify, consolidate your credit card balances to low-interest or 0% interest cards to reduce the cost of your debt. You may also want to consider a personal loan that offers a low interest rate.

• Avoid paying consolidation or consulting fees. Avoid paying fees to credit consolidators. Much of what they are doing for a fee, you can do yourself.

• Understand credit effects. There is a common misconception that carrying debt is good for your credit score. This is absolutely false. To achieve your best possible credit score, it is important to keep your debt ratio to under 30%, 10% is even better.

Bankruptcy Law, Credit, Timothy Kingcade Posts

Income Inequality: Credit Card Debt threatens African American Middle Class

Posted on January 6, 2014by Admin

According to a recent report by the NAACP and the public policy research organization, Demos, middleclass African Americans are using credit to help cover basic living expenses, when income and savings fall short. According to the report, 79 percent of African Americans carry credit card debt and 80 percent have taken out loans for their education.

Interestingly, Black and White households reported different reasons for poor credit: 44 percent of White respondents cited late mortgage payments and using all or nearly all of their credit lines, while 40 percent of Black households cited late student loan payments and credit report errors.

Middle class credit use and debt levels are similar across race. The consequences are what raise eyebrows. The report found that African Americans and Whites had similar rates of card default, late payments, bankruptcy, eviction and repossession. However, indebted African American households face higher interest rates, reporting an average APR of 17.7 percent on the card where they carry the greatest balance, compared to 15.8 percent for White households.

Economic experts point out the problem is not about spending, but about income inequality and the decline in opportunity for middle class African Americans.

Click here to read more on this story.

Bankruptcy Law, Credit, Timothy Kingcade Posts

South Floridian’s Credit Card Balances on the Decline

Posted on December 31, 2013by Admin

According to CreditKarma.com, South Floridians reduced their credit card debt in November by 13.5 percent from a year earlier. The balance on the average credit card in Broward, Palm Beach and Miami-Dade counties fell to $4,552, down from $5,264 in November 2012, CreditKarma.com reported.

Other debt balances, including mortgage debt fell from $191,970 to $184,061. Student loan balances also declined 2 percent from a year ago. The average student loan balance was $30,768 in November, a $752 drop from the $31,520 balance 12 months earlier.

Auto loan debt increased in South Florida, up $923 from a year ago. New car sales have also increased as the economy continues to improve. According to CreditKarma.com’s CEO, South Floridians are taking out more car loans because lenders are offering these to consumers with modest credit ratings. Some car dealerships are even offering 0 percent loans, making these type loans good to have.

Click here to read more on the story.