Debt Declaration – Bad Credit Help & advice, Debt Settlement Tips

A Short Sale Has Benefits – No Matter Which Side You’re On

December 1, 2010 by · Leave a Comment 

With the economy suffering, a real estate short sale is something that’s becoming more and more popular. And, with a short sale, there are benefits for everyone involved.

What exactly is a short sale in real estate?

If a homeowner is in some sort of financial trouble, he can sell his house for less than what he actually owes to the bank. In doing so, the homeowner can stop trying to make monthly payments he can’t afford, and he avoids foreclosure – something that can ruin his credit and prevent him from getting another loan for 7 years. For more information click here

A short sale is great for the buyer, because he gets a house at a price that is far below market value. It can take a long time for a real estate short sale to get finalized, but, usually, the wait is well worth it.

But what about the lender? What’s in it for them?

The bank will take a look at the homeowner’s situation – and assess how bad his financial problems really. If the issue is severe enough, the bank will usually approve a short sale. Yes, the bank winds up losing some money on the deal. However, it’s usually better than foreclosing on the house. If the bank takes over the house, they have to deal with selling it, and they have to pay costs associated with taking it over. In the long run, a short sale can actually be more cost-effective for the bank than foreclosure.

While it may start off as a bad situation, a short sale can have a happy ending for everyone involved! For more information click here

5 Debt consolidation tips you must know

September 17, 2010 by · Leave a Comment 

If the thought of your debt load is bothering you, then it’s high time that you consider debt consolidation. Credit cards are very tempting to use and if you cannot handle your credit cards properly, you can land up in a quagmire of debt. Credit card debts will soon become stressful if you do not have enough money to pay your debts off. Debt consolidation should be considered by those who do not have enough time and money to pay off debts. There are certain tips that you should remember while consolidating your debts. Read on to know about them.

1.Make sure it’s a trustworthy organization: Before committing yourself to a particular debt settlement organization, make sure that it is a reputed and a trustworthy one. First you need to investigate the company whether or not they are authorized. Check if the company has a license and is authorized with different organizations, especially the BBB. This will prevent you from falling caught under fraudulent acts.

2.Compare different debt consolidation companies: When you think of consolidating your debts through a debt consolidation company, make sure that you compare and contrast different debt consolidation companies. This will help you ensure whether or not the rate that you’re offered is the most competitive in the market. You can also see if the rate is the best rate in the market.

3.Go for secured debt consolidation service: When you go for debt consolidation services, it is better to go for secured debt consolidation. You can reap the benefits of lower interest rates and longer repayment terms as compared to unsecured debt consolidation services. This is known as collateral loans where you provide something as collateral in order to meet the repayment guidelines.

4.Review the terms and conditions: It is very important that you review the terms and conditions of the company before signing into it. If you fail to understand the legal jargons involved, it is good to hire a lawyer who can help you. It is better to spot unfavorable terms initially than later or else it may greatly affect your finances.

5.Consider the costs: Verify whether or not there are hidden costs involved in the debt consolidation services. There are certain scam companies that charge you with hidden costs and these are the scam companies. This is why you need to trust the company before agreeing on anything.

Thus, if you are seeking debt consolidation, take into account the above mentioned tips to get the best results after consolidating debts.

Methods of Debt Relief

June 3, 2010 by · Leave a Comment 

If you are trying to find a way to settle your debts, it means you have taken the first positive step in getting your finances in order. The next step is to choose one of the three main methods that can help you in this endeavor.

1. Debt Management –Debt management companies are usually non-profit outfits. They work with you in an effort to manage your finances and help you organize it in a way that is beneficial for you. They will not offer you any loans or talk to any of your creditors on your behalf. What they give you is knowledge – how to create a budget, payment plans, etc. Although this method might be frustrating at the start, the lack of any financial commitment towards the debt management company is a major advantage for anyone in debt.

2. Debt Settlement – Companies that offer this service will negotiate directly with your creditors. They are often able to get massive reductions in the amount owed (from about 20 to 60 percent), thereby enabling you to repay your creditors. All you have to do thereafter is pay the debt settlement company in installments and they in turn repay your creditors. However, this method has a lot of pitfalls in terms of hidden costs, complicated fees and fraudulent companies.

3. Debt consolidation – The idea of getting a debt consolidation loan is to help you pay off multiple creditors at once. Thereafter you are left with one big amount to be paid off. The goal here is to find a loan that has an interest rate that is lower than the ones you are paying right now. That way your monthly payments will be a lower amount, enabling you to make them on time.

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Keeping a Healthy Credit Score

June 3, 2010 by · Leave a Comment 

A person’s creditworthiness is determined by their credit score. The FICO scoring method is widely used in this regard. Lenders resort to using a scoring system to determine the risk in giving a loan to an individual. The score ultimately decides if the loan can be given or not, how much the interest rate will be and how much the credit limits will be. So you can see why it is important to have a healthy score.

The easiest thing to do to maintain a good score is to pay your credit card bills on time. By not missing any payments and staying current on all credit cards, you will build a good score. Do not for any reason miss a payment or ignore it. If you know that an item on your bill is incorrect, dispute it immediately. Not disputing it and not paying will only harm you. Details such as this go on your report, so as long as an item is marked as disputed, your score will not be affected for non-payment.

Another thing you can do is maintain a good balance on your cards. If your limit is $25,000 then try not to take the outstanding amount past $15,000. The difference will be very beneficial for you. You should also not get rid of any old cards in your possession. Settle the outstanding amount but do not close them. Long credit histories really help your score. Getting lots of new cards will impact badly on your score.

Is a Credit Score Really Important?

June 3, 2010 by · Leave a Comment 

As you move on in life, you tend to discover new things which were never really causes for concern before. A credit score is one -very important- such thing.

The generally accepted and used method of credit scoring is the Fair Isaac Corporation (FICO) method. By analyzing your credit history and current financial status, the FICO method will come up with a score. This score lets lenders know if you are a credit risk and how much so. For example, if your credit score is in the lower levels, you may be refused a loan or credit card. In the event that your request is accepted, you will be slapped with high interest rates and heavy penalties for missed payments.

Therefore keeping a healthy FICO score is in your best interests. A couple of things to keep in mind to improve the score are making payments on time and keeping a sizeable margin between the amount owed and the total credit allowed in a credit card. These two things may sound simple, but it is surprising how many people simply fail to follow them.

The other thing people constantly fail to do is to report and dispute incorrect information on their credit reports. Ignoring them and not making any payments towards them are cardinal mistakes. For example, if the report shows that you made a $500 purchase somewhere which you didn’t you should dispute it immediately. Not paying it until the dispute is settled is fine because it won’t adversely affect your credit score. But not paying and not disputing it will hurt you badly.