Income from the GetOutOfDebt.org site advertising is used to help alleviate poverty. If you would like to help me to help others, there are easy and free things you can do, click here to learn how you can help.

“Dear Steve,

I currently owe $30,000 directly to a university as a collection with 6% interest. They will not release my transcripts from my one year of study at the university until I have paid the amount in full. I am making the minimum payment every month, but my income is roughly $12-13 an hour because all I have is my high school diploma. The interest keeps accruing and I am unable to pay it off in the foreseeable future on my income. I would like to go back to school or complete some sort of training program to obtain a higher paying job, but cannot do so without my undergraduate transcripts.

How can I pay off the university in order to get my transcripts and obtain training to get a higher paying job?

Jake”

Dear Jake,

The college is holding the transcript hostage because it is the only collateral they’ve got. It certainly does not sound like this was a government backed student loan so your options are significantly limited.

Sometimes debt is just the beginning of their woes. Students who leave school because they can’t pay their bills often face a second sanction — a freeze on their education. Universities typically refuse to release transcripts for students who owe money, preventing those who’ve dropped out from finishing school elsewhere, which would better position them to repay the debt. Source

Over the years I’ve had a number of clients that have been in this very situation and until the debt is paid, the transcript remains a hostage.

Typically the issue surrounds your college regulations or student contract which says that all outstanding fees must be paid to receive course credit and official transcripts.

Your best course of action would be to attempt to negotiate a suitable solution with the university or hire a lawyer to look into the issue to determine if the college has violated the student contract in any way that may allow you to get an official transcript.

This is not necessarily a great solution but then again, I’m not a huge fan of student loans because the consequences for nonpayment can be very severe, as you’ve learned.

Big hug.

Steve

Source: Jake Wants His Transcript But He Defaulted On His Student Loan Debt

Other Related Articles to Read

• Somali Pirates Are a Good Credit Risk. Maybe They Need An American Express Card?
• C Wants to Defer Student Loans Without Hurting the Credit Report
• Jerry Wants to Know How to Repay Debts He Can’t Afford
• Pam Asks “Does a Deferred Student Loan Lower Your Credit Score”
• Is Debt Consolidation a Viable Debt Solution For Unsecured Debt?

Income from the GetOutOfDebt.org site advertising is used to help alleviate poverty. If you would like to help me to help others, there are easy and free things you can do, click here to learn how you can help.

“Dear Steve,

My husband and I just bought a home and besides the mortgage, we are in debt for $26,000.

I called up my credit card companies and they said they aren’t offering lower rates to customers now.

I went to CCCS website and they say lowering customers rates is one of their ways they can help out. If I can’t get the credit card companies to lower my interest rates, how can CCCS? I have also read some negative things about CCCS and other agenices like theirs.

What can I do to protect my family from not being able to make ends meet?

Eva”

Dear Eva,

Congratulations on the new house. I got you this answer for a house warming gift.

CCCS or any credit counseling group offers what is called a Debt Management Plan or Debt Management Program, DMP, as a way to consolidate your debts. Many people think it is a loan, it’s not. Others think it is an easy way out of debt, not necessarily.

Credit counselors are recognized by creditors to offer special terms that might involve lowering your interest rates. These terms are generally reserved for people that are having financial problems, not as a way to just lower your monthly payments.

Entering into a credit counseling program can negatively impact your credit score since it is an indication that you are having financial problems. And once your creditors see or learn about your participation, your interest rates and/or monthly minimum payments could go up.

A credit counseling program is paid for primarily by the creditor that pays the credit counseling group a percentage of money they collect from you and return to the creditor. I know, it sounds dangerously close to the services provided by a debt collection agency.

Now, there are times to use a debt management program, especially if you are having a tough time getting by each month and if you don’t get into a debt management program then you will fall behind or go bankrupt.

Nobody can give you specific advice about what terms will be offered to you in the debt management or credit counseling program until you contact the credit counseling group and ask about what terms your specific creditors typically offer.

Since the terms and interest rate reductions are very important to you, I think you should contact this group and see what the current terms are. When you contact them, also be sure to ask what your creditors will do with your minimum payment when you are in the debt management plan and ask for an estimate of what your monthly payment would be.

There is no reason for you to enroll or signup for a debt management plan to learn this information and while CCCS is one group that offers debt management plans, they are not the only one.

Finally, a debt management plan is primarily dictated by the terms the creditors offer through the credit counseling agency and not by the credit counseling agency negotiating on your behalf. There is no negotiation.

Protecting your family from not making ends meet has less to do with CCCS than it does with utilizing your money so that your most important bills are paid first. This means that your mortgage, car payment, utilities, food, etc. should be paid before you send any money towards your credit card debts. In fact, I think you should also be putting at least $100 a month into a savings account as part of your most important obligations.

If you were to fall behind on your bills and creditors closed your accounts, you’d need the savings account money to help you in an emergency. Its logical and makes sense.

Big hug.

Steve

Source: Eva Has Heard Negative Things About CCCS

Other Related Articles to Read

• April Wants To Know “As A Single Mom, How Do I Get Out Of Debt?”
• Jeannie Already Went Bankrupt And Is Now With CCCS But Can’t Afford to Feed Her Daughter
• The Perfect Debt Assistance Program
• Rita Asks “Should We Consolidate Our Debt?”
• Tony Writes In “I Have Too Much Debt On My Credit Cards”

Income from the GetOutOfDebt.org site advertising is used to help alleviate poverty. If you would like to help me to help others, there are easy and free things you can do, click here to learn how you can help.

“Dear Steve,

I filed chapter 13 bankruptcy and little to my knowledge my attorneys who represented me did not clear my credit after the filing or even in the process so in essence I still have all the listings of old creditors on my credit report and it’s a bit tasking to have them removed.

Any suggestions on how to do so? My credit score has not increased even after filing actually the calls has just stopped and I’m still in ChexSystems so what’s the purpose of bankruptcy if there is not a reflection of it to clear your credit and increase your credit score?

Do you know a great attorney that actually will clear your credit in the process?

I did see the physical results in my bankruptcy however, I desire my credit report to represent the “paper effects” of it as well.

Bre”

Dear Bre,

Wow! I’m stunned that you thought that going bankrupt would somehow clean your credit report and improve your credit score. It won’t. In fact bankruptcy adds another big negative item, bankruptcy, to your credit report and lowers your credit score in the short run.

Let me use a school analogy to help you better understand your credit report. A credit report is not like a report card, it is more like a transcript. The transcript lists all the classes you attended and the grades, good or bad, that you got. Dropping out of school does not wipe the records off your transcript. Going bankrupt does not remove negative but accurate items off your credit report.

I am very surprised that throughout your discussions with the bankruptcy attorney and the pre-bankruptcy credit counseling that this was not clarified for you.

Now that you have gone bankrupt there are ways to repair your credit and improve your credit score.

1. Get a copy of your consolidated credit report and look for any negative but inaccurate items that are listed. Use the dispute procedure shown in this credit report and have those items removed.
2. To rebuild your credit score you will need to start having good information reported on your credit report. To do this you will need to get a major credit card that will both give you a card and report to the credit reporting agencies.
3. There are credit cards available for people with bankruptcy on their record.
4. As you continue to pay your new account on time and more time passes from your bankruptcy, your credit score will improve.

Big hug.

Steve

Source: Bre Wonders Why Her Credit Report Still Shows Negative Items That She Thought Should Have Been Removed By Going Bankrupt

Other Related Articles to Read

• Jennifer Says “We Have Accumulated So Much Debt And Bad Credit. What Do We Do?”
• Bad Credit Debt Consolidation - Brutally Honest Advice
• Lauren is Searching For Ways to Get Out Of Debt And Make Her Bad Credit Go Away
• Tony Writes In “I Have Too Much Debt On My Credit Cards”
• Terri Wants to Know “Is There a Way to Get Out of Debt Without Ruining Our Credit?”

Ted gave me permission to share them and I hope they either put a smile on your face or make you ponder.

Source: Credit Card Approval - Just Because You Need to Laugh

Other Related Articles to Read

• Debit Card Concerns. Profits Hide Truth About Your Risks.

Is having and using a credit card a right or a privilege?

WC - A 27-year-old writer living in Chicago and writing about personal finance through The Writer’s Coin.

This one’s easy: this is a service. So if I had to pick I would say it’s a privilege.

When I was a kid I couldn’t understand the logic behind credit cards. My dad explained it to me and I was shocked: why would a company front you the money for something you don’t have the cash for? Well, because they’re going to make money off it, that’s why. No one owes you a credit card and you shouldn’t expect that. It is NOT a right.

Antisay - This blog is mainly about finance and self-improvement; I am in a constant race to become a better me and this blog is all about that sort of lifestyle. Visit this site.

In my opinion, owning a credit card is a privilege. By definition, a privilege is, “a right or immunity granted as a peculiar benefit, advantage, or favor.” Credit cards are grated only to those who qualify - in theory, anyway. I remember applying for a Victoria Secret store card when I was 18 and being declined because I had no credit history. Once I had a credit history, I was able to get a card with them, but with very high interest rates because I really hadn’t proved my financial self to the world yet.

Having a credit card is a privilege granted when we show that we can be responsible with money. The fact that the credit card companies have lowered their standards significantly in the last decade or so doesn’t change the fact that it’s a service they provide to those who qualify - not a service that they provide to anyone who wants it.

If you have a credit card, it is still a privilege to use it - not a right. If you go over your limit, it is not your “right” to spend more than you’re allowed, and you will get a penalty as a result. And if the credit card company decides they no longer want to lend to you, they can terminate your line of credit. If you abuse the privilege, it will be taken away or you will suffer the penalties.

As a privilege, it is something that should be treated carefully and respected - just like the privilege of recess in elementary school. If you abused the privilege by punching the kid next to you, it was taken away… and so we learn not to punch other kids. And just the same, we have to learn not to overspend or rely on credit too much - lest we find ourselves with a severe penalty. The card might not be taken away from us (unfortunately), but we’ll suffer all the same with late fees, interest, and hassling calls all the time.

I don’t really know how to conclude this - I’m left with final thoughts somewhat unrelated to the topic. Except to say that I wonder what is going through the minds of people who demand credit cards when they don’t qualify? Do they think that the card is their right? I am happy when people are rejected for cards - because I know that they won’t be able to hurt themselves more by overspending themselves into oblivion and then suffering debt misery for the rest of their lives.

Steve Rhode - A personal finance blogger and founder of the Myvesta Foundation, a global social enterprise that helps people find solutions for money troubles. You can ask Steve your debt related question through GetOutOfDebt.org and he’ll help you for free.

I believe that getting a credit card is a privilege since it is something that you must apply for and be awarded or granted access to by another entity.

I think that, rightly or wrongly, many people treat their credit card as a right.

So if having a credit card is a privilege then how much weight can we place in the screams of consumers that feel abused by creditors when the consumer put themselves in that position to begin with? And if it is a privilege and it is issued to generate revenue then isn’t it the banks ethical responsibility to use that tool to maximize revenue for the bank in any way legally possible, even at the expense of the financial well-being of their customers?

But then again, aren’t consumers eligible for fair treatment and regulatory compliance by banks. If they are, then once you get and use a credit card it comes with some rights.

J. Money - You’ll enjoy the blog Budgets Are Sexy for a look inside the life of one blogger and how money impacts it.

It’s a privilege baby! A privilege 99% of us Americans have, but it sure as hell isn’t a right. If it were EVERYONE would be able to have (and keep) one - and these days that’s simply not the case….plus look around at the rest of the world - not even close to what we have going on here. I have not way of backing this up, of course, but i’m sure it’s true.

So if you’re lucky enough to get your hands on a GOOD credit card (like with low interest rates), then cherish it and use it wisely my friend. If you get caught dicking around, it may haunt you for years to come - and that’s no fun for anyone.

Marcus - The creator of the CreditMattersBlog, this blogger has a deadly sharp point of view when it comes to consumer debt issues. Visit his blog.

If anyone says that it’s a right, I’ll be shocked.

Of course, it’s a privilege. But before you can earn the privilege, you must first be approved for a card. Indeed, we all started out with a clean slate. None of us could prove our creditworthiness from the get go. Therefore, our first card is typically granted without us having to prove a thing.

Beyond our first card, though, it is a privilege to get additional cards. No one is guaranteed the right to get approved for a credit card. Indeed, we must earn that privilege by demonstrating that we can handle additional credit. Still, even if we’ve shown that we’re capable — and responsible — there are no assurances that the card companies will continue to extend credit to us. For whatever reason, a card company could withdraw our credit lines (in the form of credit-limit decreases or closures). If that happens, you’ll then realize that it was always a privilege to have the card in the first place. Fact is, if it was a right, the card companies wouldn’t be allowed to take the credit away.

That’s my two cents on the topic.

Dawn - Iowa Hippie Chick blogs about money love and marriage and offers so very insightful posts on personal finance that involve emotional insight and awareness. Vist her blog.

This question is a no-brainer …
Having a credit card is a privilege!

It is a privilege that we earn by handling our personal finances responsibly.

I suppose, it’s similar to the privilege of driving - If not handled with care it should be taken away. Thus keeping the rest of us safe from irresponsible users!

Patrick Bryan - Living in Northern Ireland, Patrick helps people in a very different environment and economy but yet, much is universal and much is the same. Visit Patrick’s Northern Ireland blog on debt.

Until the constitution is amended to include ‘the right to get into debt’ I feel you would have to describe a credit card as a privilege rather than a right. It is a commercial decision for a credit card company to issue someone with a card – in essence they decide if they are a good risk to repay the money lent, and if there is a profit to be made from the relationship.

For many of us credit cards are a great benefit providing convenience, reduce the risk of carrying cash and provide interest free credit for up to 56 days. Until debit cards came along nothing could beat the benefit of having a credit card in your wallet, and if you use them ‘responsibly’ then I believe that we should still consider it a privilege to own one.

Unfortunately it is when people fall behind with credit cards that the dark side of our flexible friends is revealed. High interest charges, late payment fees, retroactive application of interest charges, two-cycle billing – I could go on. It is for this reason the Credit Cardholders’ Bill of Rights was proposed. The capricious nature of credit cards is that even though they are inanimate pieces of plastic they can assume magical powers, transforming themselves from a helping hand which pulls you out of trouble into a shove in the back when you are teetering on the edge of a financial precipice.

So, rather than defining a credit card as a ‘privilege’ or a ‘right’ I would prefer people to regard them as a form of ‘luxury debit card’ – a way of spending money in a safe and convenient manner, but which has to be paid back when the bill arrives each month. And if you can’t trust yourself to do this on a regular basis then it is probably best if you just use a regular debit card instead, and keep your credit cards at the bottom of your sock drawer, or locked in a high tower and guarded by a dragon.

Source: Is a Credit Card a Right or a Privilege? - Personal Finance Bloggers Question of The Week

Other Related Articles to Read

• Bob Was Injured And Is Now Behind On His Credit Cards
• Your Credit Card Company Is Waking Up After A Bender
• Ed is Disabled and Falling in Debt Fast. What Can He Do?
• More Bad News For Nordstrom and Target Credit Cards
• Bank of America Offers “Clean Sweep” Debt Consolidation Loan Up to $50,000. Let’s Look at The Facts And See Who Is Really Cleaning Up.

Reducing the principal on mortgages is “a last resort,” says Paul Koches, executive vice president at Ocwen Financial Corp., a West Palm Beach, Fla., loan servicer that has shrunk the amount owed on 10,884 delinquent mortgages as of Sept. 30. That is 23% of all the loans modified by Ocwen so far this year.

Ocwen estimates the company’s foreclosures result in an average loss of $122,000, or 59% of the loan amount. The figure has more than doubled since last year, causing Ocwen to look harder at lowering principal payments.

Early trends are encouraging. A recent study by Credit Suisse found that roughly 12% of Ocwen borrowers who had their loan balances reduced in April were at least 60 days past due five months later. In comparison, the default rate on less-aggressive loan modifications was 22% or more.

Read the rest here.

Other Related Articles to Read

• 81,312 Foreclosures in September. More Than Just a Number.
• Citigroup to Say Goodbye to 39,500 More Workers
• Bush Administration Rolls Out Wimpy Mortgage Assistance Plan
• How to Avoid Being Scammed by a Foreclosure Rescue Promise or Plan
• Some Interesting Ideas To Try To Bribe You To Spend, Spend, Spend

Even though the Federal Reserve has lowered its rate to 1%, banks are raising your interest rates in hopes of making a bigger profit. Oh yes, they are raising your fees or charging news ones as well.

At a time when the government is pleading for consumers to return to consuming, the banks are instead dissuading people from doing this by punishing consumers with higher fees and charges. And at the same time the banks are getting billions of dollars in bailout money to help get this economy moving again. It almost sounds damn near unpatriotic.

And let’s be clear about why the banks and credit card companies are scrambling to make these new revenue streams and profits. It is because the brightest and most financial savvy banking minds of our time swindled themselves by buying and insuring crap loans that inflated housing values and now result in record numbers of foreclosures. That’s some damn smart banking.

So the banks losses are the direct result of their own ineptitude and you are going to pay for it with higher credit card fees and charges.

What Credit Card Companies Are Doing

I would not be surprised at all to see monthly payments for cardholders to increase significantly as more creditors take the Chase lead to increase monthly minimum payments from where they are now. It is a quick win to increase their cash flow and will likely result in higher losses, but more cash now, when they need it.

Here is an example of what it can mean to you:

$10,000 Card Balance
Old Minimum Payment: $200/mo
New Minimum Payment: $500/mo

Imagine if all your cards did that to you, which they legally can. Many monthly budgets would be torpedoed leading to missed or late payments, but wait, that generates more fees to the credit card companies. Me sees a plan.

The banks will claim that by raising the monthly minimum payments that it is in the interest of the debtor since it will help the consumer to pay their bills off faster and get out of debt sooner. Truly this is nothing more than raising the hurdles higher and then saying it is better for runners who now have to jump higher.

Credit Cards Still Available

You should not get the impression that credit card accounts are not still plentiful and available. Just look here to see what is being offered.

While credit card companies are going to punish and raise revenue on its current crop of hostages, ah, customers, they are not going to stop extending credit. It’s what they do.

That is a good news, bad news situation. If you are stuck with a bad card with horrible rates and terms, it is still possible to switch. Granted, with credit standards toughening it is harder to switch of you have bad credit.

Source: Credit Card Companies Are Coming For You. Protect the Wife and Children.

Other Related Articles to Read

• Banks Agree to Wipe Out Up to 40 Percent of Credit Card Debt But Watch Out.
• Credit Card Horror Stories: Tales of Credit Limit Reductions and Account Closures
• Debt Collectors Buying Bad Debts Make a Killing in a Bad Economy
• Soon, Where You Shop Will Control Your Credit
• John McCain Has Bad Credit Card Rates

The hijackers have a favorite part of the coast to park their ships while they await the ransom to be dropped from the sky, in cash. On last count there were 13 ships parked and awaiting ransom to be paid.

The new pirate business is improving the money generated by local merchants on shore. Each day supply vessels come to shore to by new supplies for the pirates and their hostages. Small businesses have no problem extending credit to the pirates since they are paid in full once the ransom is delivered. Best yet, the pirates pay their bills in cash.

One local merchant said she is so confident in the pirates, she instituted a layaway plan just for them.

“They always take things without paying and we put them into the book of debts”. “Later, when they get the ransom money, they pay us a lot.”

I guess the pirates have just not figured out they could get reward credit cards to use to pay for hostage goodies. That way they’d get free air miles without blackout dates.

Source: Somali Pirates Are a Good Credit Risk. Maybe They Need An American Express Card?

Other Related Articles to Read

• ML Writes In, “I Can’t Pay My American Express Card.”
• Jake Wants His Transcript But He Defaulted On His Student Loan Debt
• Credit Card Companies Are Coming For You. Protect the Wife and Children.
• Valerie And Her Vanishing American Express Card Business Account
• BB Owes American Express $40,000, She Can’t Pay It, Bill Collectors Are Starting to Call

Income from the GetOutOfDebt.org site advertising is used to help alleviate poverty. If you would like to help me to help others, there are easy and free things you can do, click here to learn how you can help.

“Dear Steve,

I am disabled and falling in debt faster than i can handle. I am barely staying alive with trying to feed my family. I am behind on my mortgage and regular bills (utilities). I stopped paying on my credit cards just to try and keep my utilities from being disconnected. credit card companys are calling me constantly for there payment. I don’t even have the money to pay the lawyer for claiming bankruptcy. I don’t know where to turn. please help !!

What can I do???

Ed”

Dear Ed,

You’ve done the right thing by stopping payments to the credit card companies. You need to focus your repayment efforts on the mortgage and utilities at this point.

What I don’t know is if you can reasonably expect to be able to afford your mortgage any longer. It might just be that will your reduced income that you can’t afford the home. In that case you should give the home back to the bank and then go bankrupt to eliminate all your past debt, including any money the bank may want from you following the foreclosure of your home. I am assuming that you have little to no equity in your property.

At that point you can stop running for cover all the time and just focus on building a safer financial future for you and your family using what you’ve got coming in each month.

There are self-help bankruptcy materials available and you can usually get free bankruptcy forms from the local bankruptcy court.

If you decide that you can move then you can stop making the mortgage payments to save a rent deposit and to file for bankruptcy. That should allow you to do what needs to be done.

Big hug.

Steve

Source: Ed is Disabled and Falling in Debt Fast. What Can He Do?

Other Related Articles to Read

• Kayte Has Drained Her Savings And Can’t Pay The Bills Anymore
• Louis Says “I Feel Like Killing Myself Because of My Debts”
• Expect Tidal Wave Of Limit Reductions and Credit Card Closures to Hit Before Christmas
• Soon, Where You Shop Will Control Your Credit
• Josy Writes “My Real Estate Business Is Going Down The Drain”

Income from the GetOutOfDebt.org site advertising is used to help alleviate poverty. If you would like to help me to help others, there are easy and free things you can do, click here to learn how you can help.

“Dear Steve,

I am a single mom and heavily in debt. I was living with my husband (we are legally separated) because of finances but recently I moved out. I am not behind on my payments at this time because I didn’t have to pay rent, utilities, etc. It is only a matter of time before I can’t make my credit card payments. I don”t know what I should do. Help!!

Should I file bankruptcy?

Trisha”

Dear Trisha,

Your situation is fairly typical. When a couple splits they now have two households to maintain on the same income they used to maintain one. Divorce and separation is often the event that leads one or both partners to bankruptcy.

I suspect that the only reason you are not behind yet is that since you recently moved out, all the new payments have not hit yet, or that you are using what little saved money you might have to make ends meet.

I think that you should use this event to not only start your marital life over but your financial life as well. If you do decide to go bankrupt it will eliminate and debt in your name and remove your liability to repay any joint debt that he has said he would pay.

The most important thing to remember about divorce is that even if he agrees to pay a debt that you might be jointly responsible for, it is still your responsibility to repay that debt if he does not. When you get divorced, you divorce your spouse, not your creditors.

Before you make any decision and certainly before you send any more money to creditors, I think you should find and meet with a local bankruptcy attorney for a free bankruptcy review. Get a legal opinion from the bankruptcy lawyer about what bankruptcy will mean for you and then make a choice about what you want to do. If you decide to not go bankrupt than come back and let me know. I’ll come up with a Plan B for you at that point.

Big hug.

Steve

Source: Trisha is a Single Mom, Separated, and Facing Bankruptcy. What Should She Do?

Other Related Articles to Read

• Diana Is Struggling to Make Credit Card Payments And Afraid
• Kayte Has Drained Her Savings And Can’t Pay The Bills Anymore
• Free Bankruptcy Review Request
• April Wants To Know “As A Single Mom, How Do I Get Out Of Debt?”
• I’m Afraid I’m Going To Get Laid Off. How Will I Pay My Bills? What Will I Do?