If you're like most people, paying all the bills each month is very difficult!

If you are barely making ends meet, you might try these tips on how to find extra money each month.

The first step in finding extra money each month is to complete a buget.  You need to be very honest with yourself and list everything you are spending money for each month.

Yes, even Starbucks!

Now that you know where you stand, financially, it's time to go to work to see where cuts can be made.

Let's start with you credit card bill or bills.

I know you don't want to hear this, but STOP BUYING THINGS ON CREDIT!  I know the rationalization, but if you really want to cut your budget, you cannot justify an extra $10 here and $10 there.  It all adds up...way too much!

If you have credit cards with interest rates of 20% or more, you should be able to get them lowered.

Call the credit card company.  The number will be on your bill. 

When you get the representative on the line, tell them that you must cut your rates and need them to lower yours.  If they refuse or say that they can't, tell them (nice way of threatening) them that then you will have to shop around for another creditor to transfer your balance to.

Don't give up!  The credit card industry can modify the rates.  Obviously, they want to charge as much as possible, so they train their representative to be tough, but YOU HAVE TO BE TOUGHER!

By the way, if you have too much credit card debt and are not able to keep up with the monthly payments, there are several option that may help.

What about that CABLE BILL?

If your not careful, your cable company may slowly raise your bill.

We have a cable company (I won't use their name, but they are BIG!) and have the bundled package (cable, phone, internet, etc.).  Our monthly bill is usually about $200. Last month, the bill was $260! That's almost a 30% increase!  WHY????

We called the company and was connected to a customer service representative.  She said that there was nothing she could do about it, that it was just a "normal" rate increase.

So, we asked to be transferred to the LOYALTY OR CUSTOMER RENTION DEPARTMENT.

Since we had been "loyal customers for so many years...", they said they would not increase our bill!  Again, you have to be tough and don't give up!

Utility Bills

It seems that utility companies can get away with raising rates anytime they want to!  I know there is some kind of "government application process" each utility company must go through, but when is the last time you saw your rates lowered?

So here's a few tips you can use to cut those utility bills:

Your Heating Bill

We'll talk about how to cut your ELECTRIC or GAS bill later, but first, when is the last time you checked your home for air leaks or drafts?

Yes, you could call a company that does this, but not only will it cost you, most likely they are going to recommend replacing or updating your equipment!

Check all of your windows by feeling for cold drafts of air.  If you feel a little cold air, that means that your warm air is most likely going out!

You can get several types of sealers or caulking for windows and doors at your local home improvement store.  If your not sure which one you should use, most of the sales reps can help.

What about your old ELECTRIC OR GAS FURNACE?

I'm a do-it-yourself guy, and each time I go into one of our local home improvement stores, there's a sales person trying to get me to "upgrade" my furnance.

Yes, mine is an older model, and yes, the new ones are much more efficient, but I'm having a hard time justifying spend $4,000 - $5,000 to save $30 -$50 on my electric or gas bill!

I know there are government programs that may give me a credit, but I know that by just checking all of my windows, doors, under the sink, etc., I can save a lot of money, and you can too!

WATER BILL

Check for leaks!  Just a little faucet drip can end up costing a lot of extra money on your water bill.

Not just the faucets, but check those toilets!  If you hear them continuing to run, $$$$ down the drain.

Once again, you should have to call a plumber, but can get great do-it-yourself help online or at your local home improvement store.

INSURANCE RATES

I know you have seen the ads on TV about saving up to 15% on you car insurance, but have you compared your current policies?

Get out your insurance bill (car, home, other) and go on line to compare. I'm not advocating reducing a lot of coverage to save money, but you may not need all of the "extras" you have been paying for.

If you are paying for your own HEALTH INSURANCE, it's time to check it out.  Most health insurancd premiums can be dramatically reduced by electing to increase your deductible and/or co-pay.

These are just a few tips on how to find extra money each month, and you may discover more!

What if by just following a few of these suggestions, you could find an extra $50, $100 or more each month?  Is it worth it...you bet it is!  Good luck!

Annoyed with debt collector calls? 

Here is how to Put a Stop to Debt Collection Calls

Anyone that has had financial troubles and fallen behind in there payments to creditors understands just how frustrating and annoying those calls from debt collectors can be.

Not only are they annoying, but embarrassing as well!

Who wants to hear, "Dad, some guy calling about your credit card bill!"

Debt collectors are paid to get you to pay up.

They are (for the most part) trained professionals who will use every trick in the book to get you to pay.

Most abide by the law spelled out in the Fair Debt Collection Practices Act, but many do not.

First, it is important for you to know the basics of what a debt collector can and cannot do:

A debt collector cannot call you at all hours of the day.  They cannot call before 8:00 AM or after 9:00 PM.

They cannot call you at work if they are told by phone or in writing not to call you there!

A debt collector can call family or friends to inquire about your whereabouts, but the are prohibited from discussing your debts.

What debt collectors CAN'T do:

• use threats of harm or violence
• use profane language
• use threat of legal action if such action is not taken
• give false or misleading information about your debt
• threaten to take any property
• and there are many more... (check out the Federal Trade Commission's Information on how to deal with Debt Collectors).

OK, so you want to put a STOP TO COLLECTION CALLS:

You will need to write a short, legible letter that demands that the debt collector stop calling you immediately.

Although you want to be authoritative, you don't want to be rude or use language you may regret latter.

Remember, most likely, you owe the debt and would like to SETTLE THE DEBT, one of these days.

Located in Portland, Oregon, we have been helping clients stop receiving debt collection calls for over 10 years.

To receive a copy of the letter we use, click below:

Once you have the letter written, you should send it by CERTIFIED MAIL with a RETURN RECEIPT.

This way, you have proof that not only did you mail the letter, but they received it.

WHAT IF Debt Collectors KEEP CALLING????

If the calls don't stop, write down the date, time and try to get name of the person calling.

You will need this later to file a complaint.

You have the right to sue a debt collector in a state or federal court.  You can contact your state's attorney general's office to file a complaint. If successful, you may be awarded up to $1,000 per violation!

To file a complaint with the Federal Trade Commission, click here.

Each state has it's own site, and/or method to file a complaint.

For example, if you live in Oregon, click here to file a complaint.

That should do it, but if you would like more information about how to Stop Debt Collectors or would like to know how a debt settlement program could help you, click below:

Confused about Debt Settlement?  Here are some easy to understand, basic information about debt settlement that will help.

If you are like thousands of others of consumers that have way to much debt, take heart!

There are several options for you to become DEBT FREE once again, including what is referred to as DEBT SETTLEMENT.

We are all living through some very financially difficult times.  Yes, there are those who say that our economy is starting to rebound, but if you are like so many people, just trying to survive has lead to a mountain of debt that may be out of control.

Most people that seek our help have not run up thousands of dollars of unsecured debt such as:

• Credit Cards
• Store Cards
• Personal loans or lines of credit
• Private student loans
• Cash advance loans

No, most people are probably like you and are in this debt mess due to one or more of the following:

• Major accident or illness
• Limited fixed income of Social Security or meager Retirement Benefits
• Disablitly
• Divorce
• Death of spouse of partner

So, here you are with several credit cards that have balances that demand more of a monthly payment than you can afford!

If you qualify, a DEBT MANAGEMENT PROGRAM might help.  Debt Management is the modern name for what we use to refer as CREDIT COUNSELING.

In a Debt Management Program, each of your creditors usually (not always) agree to a reduced interest rate and possibly a waiver or reduction in over-the-limit fees or late fees.

You would have one monthly payment that is made to a Debt Management Company and they in turn distribute the required amount to each creditor.

Most Debt Management Programs take about 48 months (some less and some more).

The problem with most Debt Management Programs is that the required monthly payment is just too high for all of the debt your are carrying!

For example...

If you have a total of $25,000 charged on several credit cards, the payment needed for most Debt Management Programs would be about 2.5% (or a little more) or about $625 per month!

In my office here in Portland, Oregon, I've had many people tell me, "Are you kidding?  If I had that much, I wouldn't be behind!"

So, that leaves us with Debt Settlement.

In a Debt Settlement Program, a debt counselor will go over your financial/household budget to determine where you stand.

This can be very revealing, as most people take the "head-in-the-sane" approach with so much debt.

You may find out that after being honest with yourself, you really only have about $350 per month remaining after all the essential bills are paid!

DON'T PANIC!

With a Debt Settlement Program, your creditors are not going to be receiving monthly payments.

Instead, you are going to be making a deposit into a FDIC bank account each month.

Yes, your accounts are going to become "late and/or delinquent", but really, there is nothing you can do about it due to your financial hardship.

Once your account is late approximately 120-180 days, the account will be most likely referred to a debt collector.

Now, the original creditor will be willing (not always, but in most cases) to accept a settlement for less that is due on the balance.

Most settlements average around 50% of the balance.  Some lower and some higher, depending on circumstances.

Once the account is SETTLED, you will receive a letter stating that this account has been "paid-as-agreed" or "settled-as-agreed".

The credit reporting agencies will be notified that this account has been settled as well.

Over time, your credit score will show improvement!

If you would like to receive a FREE BOOKLET that will explain more about DEBT SETTLEMENT, click below:

Here's some very helpful tips on how to stop the dirty tricks debt collectors use.

Dealing with debt collectors can be very frustrating, especially if you do not know what a debt collector can and cannot legally do!

The Federal Trade Commission acts to enforce the Fair Debt Collection Practices Act when debt collectors violate the law.

The Fair Debt Collection Practices Act - Guide for Consumers, will help you understand your rights and help you deal with debt collectors.

One of the most annoying tactics used by debt collectors is to make numerous calls.  Many debt collectors use automated dialers that seem to work around the clock! 

Even if you are on the National Do Not Call List, a debt collector can legally call you as you have had a previous business agreement.

But, YOU CAN PUT A STOP TO DEBT COLLECTOR CALLS!

In some cases, a faxed letter will work, but to be sure, writing and sending by registered mail is much more effective!

Although a debt collector can call your family, friends and in some cases a neighbor, THEY CANNOT DISCUSS YOUR DEBT.  A debt collector can only call them to see if they can find our your phone number or where you live.

A debt collector cannot call you at work if your employer doesn't allow you to receive calls at work.  Many times you can verbally demand that the debt collector stop calling your place of employment and that will do it.  If not, write a letter.

A debt collector cannot make false statements, use obscene language, make threats of violence on the phone or in writing!

Although most debt collectors act in a semi-professional manner, there are some that will try any and all dirty tricks in order to collect their commission if they get you to pay up!

One of the most used dirty tricks that a debt collector uses is sending a "legal looking letter" that seems to indicate that you are being sued!

The Fair Debt Collection Practices Act clearly prohibits a debt collector, and even debt collectors that are attorneys, from threatening to take legal action if in fact they do not intend to.

For example, a debt collector will send a letter that says something like:

"At this time, this office has not taken any legal action, but...." or...

"If you do not contact this office within 20 days from the date it was mailed, this account will be turned over to our legal department for review."

If you received (or have received) a letter like that, then you know it is scarry!

Remember, a debt collector cannot take "legal action" until they have had an attorney, licensed in your state, prepare and submit a "claim" to your county courthouse.

Then, a SUMMONS is prepared and delivered to you.

If you do not act on the summons, then they would most likely be awarded a DEFAULT JUDGMENT.

After the judgment has been awarded, they can now take legal action such as:

• Wage Garnishment
• Bank Levy
• Place a lien on your home

The point is that just because a debt collector's letter sounds like they have taken legal action, doesn't necessarily mean that they have.

Finally, a debt collector usually has the ability to accept a lesser amount than the full amount that is due.  This is called a DEBT SETTLEMENT.

Debt collectors are paid to collect as much money from you as possible!  They may tell you that their client (the original creditor) will not accept a reduction of the balance or may say that they will only accept a very small reduction.

A consumer that has not had the experience of dealing with professional debt collectors can be intimidated and may pay much more than is necessary to settle the debt.

We have helped hundreds of clients settle debts at 50% or below for many years.

Click here for ACTUAL SETTLEMENT EXAMPLES.

Don't fall for the dirty tricks of debt collectors!

Would you like to know how to improve your credit score?

 Here are a few very helpful tips you can use to do it yourself.

I've written several articles and blogs on the subject of Credit Repair, How to Improve Your Credit Score, How to Have Errors on Your Credit Report Corrected, etc. over the years.

When it comes to the subject of "CREDIT REPAIR", there are several misconceptions, but the most prevalent is that you can get the top three credit reporting agencies (Equifax, Experian or TransUnion) to remove negative information from your credit report.!

You may have seen ads from the newspaper, TV, radio, on line or phone making claims such as:

• "We can remove bankruptcies, judgments, liens and bad loans from your credit report!"
• "We can erase bad credit!"
• "We will help you create a new credit identity that is 100% legal!"

Credit Reporting agencies sell (that's right, they are in business to make a profit) your credit history to those who need to know that if they loan you money, you have (or have had in the past) the ability and track record to repay that loan!

Make sense?  Sure.  Then why would you think that you or some Credit Repair Company could magically make negative information disappear?

Yes, there are some credit repair companies who, in my opinion (and most likely your state's attorey general) have the methodology to have some negative items removed from your credit report for a short period of time or until the creditor realizes it and makes a claim to have it replaced!

Some people will pay a lot of money for this type of shady "credit repair" in order to get a loan or possibly qualify for an apartment or even for employment.

Be very careful of these claims!  They could come back to  haunt you!

The Federal Trade Commission has written many good articles on this subject and credit repair in general.

Here's a link to a very good article: CREDIT REPAIR: HOW TO HELP YOURSELF

OK, but what about LEGITIMATE ERRORS?

If you haven't done so already, you need a copy of your credit report (not necessarily your score at this time) from each of the top 3 Credit Reporting agencies.

If you have applied for credit, insurance or employment, and were denied, you can request a copy of the report, if you do it within 60 days.

You are entitled to a FREE CREDIT REPORT every 12 months.  Just go to www.annualcreditreport.com or call 1-877-322-8228.

Carefully check all of information on all 3 reports.

Make sure you name, social security number, address, etc. are correct.

What you are looking for is accounts that you know (and can prove) that you have paid off.

Also, depending on your state's statute of limitations, negative information in the past (charge offs, accounts that you were late paying often, etc.) can be removed after a certain number of years.

For example, if you live in Oregon, the statute of limitations is 6 years on most accounts.

But, the biggest thing you are looking for is for accounts that you have paid off and are still showing a balance or may have been turned over to a collection agency.

Make a copy of your the page of the credit report showing the account you wish to dispute.

• Circle the account.

Gather the proof of payment:

• Letter or account statement with $0 balance
• Copies of check and/or money order you used (you may have to contact your bank or go on line)
• Letter of satisfaction if you paid off a judgment

Now, you are going to write a letter with this information to EACH OF THE 3 CREDIT REPORTING AGENCIES.

Yes, you can go on line and in many cases this works best, but somehow I think the "paper trail" of a letter with proof is more effective.

If you do not get a reply within 45 days, make sure to follow up!  Don't GIVE UP!

This is where I think it may be a good idea to hire a professional, ethical credit repair company to do this for you.

Yes, it will cost you some money, but there is a lot of time and effort that will go into challenging several items and you may not want to spend the time.

Check with your state's attorney general's office for a list of good, reliable credit repair companies.

If you live in Oregon, click here for a list of registered companies.

Comment on the subject of Credit Report Disputes:

Recently, I had written a blog about this subject and received a comment from a Credit Repair Company owner.

The blog was titled "Best Options for Credit Card Debt Relief" in which I listed and explained several ways to help get debt.

He commented and asked the question why I did not explain how to "fight for non payment of a credit card" rather than file for bankruptcy.

I understand and apprecitate the comment, but in my opinion, if you or I agree to repay a debt by taking out credit, then we have given our word...made a promise to repay and should do so if at all possible.

I don't think it is right to try an find a loophole such as they fact that a debt collector (as much as I don't like most of them) can't provide sufficient paper work to prove that the debt is legitimate in order to get out of paying a debt you know you owe.

On the other hand, I've had cases where after a creditor or collector agreed to accept less than the full balance due to the severe financial hardship of the consumer, the remaining balance showed up at another collection agency later.

Of course, in that case, you should (and we successfully did) dispute the claim.

I understand that there are many circumstances that happen that may make repayment impossible.

In those cases, if a Debt Management Program or a Debt Settlement Program can help, then a person should take advantage of such programs.

If things are so dire that neither program can help, then Bankruptcy may or should be the only option.

So, for your DO IT YOURSELF CREDIT SCORE CHECK UP:

• Order a FREE Credit Report
• Check for errors
• Gather proof of payment
• Write letters
• Follow up! Follow up! Follow up!

If all of this sounds like TOO MUCH, we can help:

When you have too much credit card debt, you only have a few options. 

Here are 3 options for credit card debt relief:

#1 Debt Management or what is commonly referred to as Credit Counseling

The credit card industry makes billions of dollars loaning us money to purchase things with credit versus using cash.

You can get several types of credit card interest calculator programs on line, but I found a good one at ZilchWorks.

You will be shocked to see how much interest and fees you really pay on your credit cards!

For example...

Let's say you have a Visa Card with a balance of $2,500 at an annual percentage rate of 21%.

How long (and how much) do you think you will repay if you make the minimum payments until the balance is fully paid?

I know it is hard to believe, but you could end up paying back anywhere from 4 to 5 times the original amount you borrowed!

If your one of the 7 out of 10 people in the US that has a credit card balance, and are only able to make the minimum payments each month, you should consider a DEBT MANAGEMENT PROGRAM.

In a DEBT MANAGEMENT PROGRAM, you will have:

• ONE MONTHLY PAYMENT
• REDUCED INTEREST RATES
• WAIVED LATE and/or OVER THE LIMIT FEES

Most Debt Management Programs take about 4 - 5 years to complete, and the consumer will not only be DEBT FREE, but save thousands of dollars in interest and fees.

Does a Debt Management Program hurt you credit score?

Common question, but the answer is not just a simple "yes" or "no".

There are many factors that go into determining a credit score and I've written several blogs over the last few years.  Go to "What Determines My Credit Score" for more information.

But for now, the best answer is "no" because with too much credit, your credit score most likely has already been damaged.

The only way to improve your credit score is to start paying off those debts and a Debt Management Program may be the way to go for you.

But, not everyone can qualify for a Debt Management Program. If that is your situation, then you should strongly consider a DEBT SETTLEMENT PROGRAM.

#2 Debt Settlement Program

Features of a Debt Settlement Program:

• Have ONE MONTHLY PAYMENT (that will fit your current budget)
• Each of your debt will be negotiated at a balance that is approximately 50% of the current balance.
• A QUALIFIED, PROFESSIONAL Debt Settlement Company will explain all of the pros and cons of a Debt Management Program.

There has been a lot of good and bad press written about Debt Settlement Companies.

Here are 3 tips on choosing a good Debt Settlement Company:

1)  Check with the Better Business Bureau.  It is not important that the company be an "accredited" company with the BBB.  The BBB charges a fee (no, the BBB is not a government agency but a "for profit" company.  What you are looking for is the rating (A+) and complaints.  Stay away from "shady" companies!

2)  Are they registered with the state?  Not all states require registration, but if your state does, DO NOT choose a company that is not on the state's list of registered Debt Settlement/Management companies.

3)  When you call the company, are you connected with someone you can understand and that seems to be more interested in you than just "signing you up"?  A good Debt Settlement Company will offer a FREE CONSULTATION WITH NO OBLIGATION.  Don't let anyone or any company pressure you into making a quick decision!

If you do not qualify for a Debt Management or Debt Settlement Program, then you may need to seek BANKRUPTCY PROTECTION.

#3 Bankruptcy Protection

Although the word "bankruptcy" brings up all kinds of sentiments and feelings, in some cases, it is not only the only choice, but could be the best choice!

If your financial situation is so dire that you cannot make payments towards your debts, then you must seek the counsel of a qualified attorney who specializes in bankruptcy.

He or she must offer an initial free consultation and demonstrate not only a professional but personal quality.  If you would just like to get more information without making any commitment, then click on the button below:

A wage garnishment because of unpaid bills can be devastating!

Here are 3 easy tips on how to stop wage garnishment:

If you are having a difficult time keeping up with your credit card accounts or other unsecured debt, your not alone!

Over the recent years, hundreds of thousands of people just like you have had to take on more credit in order to survive the downturn in our economy or other financial setbacks such as:

• Loss of employment
• Divorce
• Illness
• Death of a spouse
• Disability
• Too little income from Social Security, etc.

Once you miss a payment to one of your creditors, they will start calling and sending late notices.

You can download FREE INFORMATION ON HOW TO STOP COLLECTION CALLS by clicking on the button below:

TIP # 1: DON'T IGNORE THE CALLS OR LETTERS FROM COLLECTORS!

The biggest mistake I see people make that can lead to a wage garnishment is to ignore the calls and/or letters.

Obviously, if you miss a payment, it is going to trigger a signal to alert the creditor.  Creditors don't necessarily want you to pay off your entire account (they make their money on interest and fees!), but they demand a monthly payment...or they get real upset!

Your account will usually be sent to an internal collections department within the company when it is about 90 days over due.  The collection departments job is to save the account...get you to start paying again.

They may offer you a HARDSHIP PLAN, but BE CAREFUL! 

Most hardship plans will offer you a small reduction in your payment and perhaps your interest rate for maybe, 6-12 months.  Sometimes, they may offer to waive the "late charges and/or over-the-limit" fees they may have tacked on to the balance. However, the problem with a hardship plan is that, while it may stop the calls, you are not really paying down the debt.

Also, once the time period of the hardship plan expires, you are right back to making the normal payments!

TIP # 2: DON'T IGNORE A SUMMONS!

If a creditor cannot get you to start making payments again, they may decide to send the account to a collection agency. The calls and letters will start again as you will no longer be dealing with the original creditor anymore.

Just as you did before, you will need to send a letter to the collection agency to stop the calls.

If the collection agency cannot get you to pay, they may decide to file a complaint with your local courthouse stating that you owe the debt. The court will prepare a SUMMONS, and you will most likely get a know at the door one evening and someone (may be a police officer), will SERVE YOU THE SUMMONS.

Sounds intimidating...and it is! Yet, the worst thing you can do (and a lot of people make this mistake) is to ignore the summons!

The summons will state who you owe and how much, and it will say that you have 20-30 days (depending on your state's laws) to give an ANSWER. An answer is a legal term that you would file if you feel that you do not owe the debt.

In most states, you will have to pay a filing fee and it has to be legally correct in order to file, so you may need to hire an attorney.

Just because you received a summons does not mean that you are going to be sued, or go to jail, or have all of your belongings confiscated...you still have rights!

But what it DOES mean is that the creditor is SERIOUS about collecting the debt.

If you are employed, the creditor could be awarded 25% of your net take home pay until 100% of the debt is repaid with interest (9% in Oregon...each state varies a little).

Call the collection company or attorney representing the collection company and try to work out a SETTLEMENT or a repayment plan called a "stipulated agreement".

If you don't, the creditor will be awarded a judgment by default (called a default judgment), and now they can pursue legal avenues including wage garnishment!

TIP # 3: IF AT ALL POSSIBLE, MAKE AN LUMP SUM OFFER TO SETTLE THE ACCOUNT!

I know, you most likely do not have a lot of money in savings, but let's say the total debt is $2,000 including interest, attorney fees and court costs, they may be will to take 70%-80% to settle the debt.

If you had contacted the creditor before the account went to collections and then the legal process, you may have been able to settle for 50% or less!

We have been helping people get out of debt for many years and would like to help you.

                                 FREE, NO OBLIGATION CONSULTATION

A lady from Portland, Oregon called to ask, "What really determines my credit score?"

There is a lot of misleading information about credit scores and this information should help.

According to the Fair Isaac Corporation (FICO), your credit score is made of many factors, but the most important are:

• Payment History (35%) 
• Amounts you Owe (30%)
• Length of Credit History (15%)
• Types of Credit Used (10%)
• New Credit (10%)

Your PAYMENT HISTORY (which accounts for the greatest percentage in determining your credit score) looks at how and when you pay your debts!

• Do you pay on time?
• If not, how late were you and how often were you late?
• Do you have negative items on your credit report such as a bankruptcy, judgment, lien or lawsuit?

Being late on a payment is not necessarily a terrible factor on your credit report, but they are looking at:

• How late where you (30,60, 90 days, or more?)
• How much was the balance?
• How recent were you late?
• How many times are or where you late?

The next major factor that affects your credit score is the total amounts or balances on your accounts. (This makes up 30% of your credit score!)

Having outstanding balances is not a bad thing, but what the credit reporting agencies are looking for is how much of your available credit have you used?

They refer to this as your "DEBT RATIO".

What is my debt ratio?

Let's say you have 5 Credit Card accounts with a total available credit line of $20,000.

If you have only two balances of the five and the total balance is $2,000, then your DEBT RATIOwould be only 10% (2,000/20,000).

This shows creditors that although you have $20,000 of available credit, you are only using a small percentage and therefore are a better "CREDIT RISK".

On the other hand, let's say of the $20,000 of available credit you have, you have had to charge up $15,000.  Now your DEBT RATION would be 75%!

Creditors could be cautious in lending or extending any more credit to someone with that high of a DEBT RATIO!

The next factor that is used in determining your credit score is the LENGTH OF YOUR CREDIT HISTORY.

Although it may seem unfair, those who are young and/or have never established a credit history will not have a very favorable credit score, but will find it hard to be extended credit.

What type of credit accounts do you have?

The credit reporting agencies look at the various types of accounts such as:

• Credit cards
• Store or retail accounts
• Installment loans
• Finance Company Loans (pay-day loans)
• Mortgages

You don't have to have one of each, but what the credit reporting agencies are looking for are a balance.

For example, if you had 5 or 6 Finance Company or Pay-Day loans (which usually carry very high interest rates and fees), you would most likely be considered a greater risk than someone who had a couple of credit cards (Visa, Master Card, Discover, etc.) and maybe one Sears card.

Finally, what about your NEW CREDIT?

How does New Credit affect my score?

The credit reporting agencies look at several "new accounts" as a greater risk than someone who say, had been using a (or a few) credit cards for several years and just recently signed up for one store card.

It is a negative mark on your credit report to go out and sign up for several NEW ACCOUNTS in a short period of time.

One final bit of advice, DON'T CANCEL OLD ACCOUNTS!

Closing accounts does not help your credit score.  You want an established credit history.

Even if you have had problems in the past, you can improve your credit score!

But what if you have so much debt that you simply cannot keep up with the payments?

Here in Oregon, we've been helping people become DEBT FREE for over 10 years.

Many people have used our DEBT SETTLEMENT program to final become DEBT FREE!

Once it has been determined that you simply cannot keep up with your minimum monthly payments and cannot meet the payment required in a Debt Consolidation or what is called a Debt Management Program, a Debt Settlement Program could be the answer!

We are not talking about secured debt (home mortgage, equity line of credit, etc.) but rather UNSECURED DEBTS, such as:

• Credit Cards
• Store Cards and Accounts
• Personal bank loans
• Deficiency Judgment after repossession
• Private Student Loan
• Pay Day Loans
• Medical bills

A Debt Settlement Program can help you:

• By lowering your monthly total debt payment
• Potentially save you thousands of dollars by negotiating a settlement for less than the full balance due
• Avoid turning to Bankruptcy!

photo by: Casey Kinstantin

If you are overwhelmed by too much credit card debt, we can help!

Many people find themselves drowning in credit card debt and other unsecured debts, but don't know what to do about it?

We get calls daily asking for advice from people who have too much credit card debt in Portland, Oregon (where our office is).

Maybe you find yourself in this situation and have considered:

• Debt Management,Consolidation or Credit Counseling
• Debt Settlement
• Bankruptcy

There are many factors that should be considered before deciding on which program or debt solution would be appropriate for you:

Are you still working or have you retired?

Is you primary source of income from Retirement Sources?

• Social Security
• Pension
• 401(K)

If unemployed, what are the realistic chances that you will find a job within the next 3 months or so and if so, will you be earning the same as before or less?

Let's discus the first option, DEBT MANAGEMENT.

Debt Management is the term used today can also be referred to as "Debt Consolidation" or "Credit Counseling".

In a Debt Management Program, you most likely will have several credit cards or other unsecured accounts and you are making the minimum payments, but the interest rates and fees are making it almost impossible to pay off these debts within 15-20 years!

In a Debt Management Program, you will get credit card debt help as you will have:

• ONE MONTHLY PAYMENT
• LOWER INTEREST RATES
• MOST FEES ARE FORGIVEN
• A TARGET OF 48-60 MONTHS TO BE DEBT FREE!

How will this affect your credit score?

Your credit score is deteremined by several factors. Here are a few:

• How much debt to income you have (debt/income ratio).
• How much debt you have taken on compared to the available credit you have.
• Your payment history.
• Types of credit accounts you have.

You must realize that having too much credit is usually the main reason your credit score is low.

Any program that helps ELIMINATE DEBT, will ultimately help improve your credit score!

If after a thorough FINANCIAL CONSULTATION, it is obvious that you cannot afford a Debt Management Program, then may qualify for a Debt Settlement Program.

In a Debt Settlement Program, you will have ONE MONTHLY PAYMENT that is designed to fit your budget.

It is usually much lower than what would be required of a Debt Management Program's payment.

In a Debt Settlement Program, your accounts WILL NOT be getting a monthly payment.

Most people who choose Debt Settlement over Debt Management, have had a severe financial hardship or have had accounts that have been charged off or are severely delinquent.

Debt collectors are calling constantly.

In a Debt Settlement Program, a trained debt negotiator will arranage a reduced payoff of that account.

Once settled, the company or creditor will report it to the credit reporting agencies as "paid as agreed" or "settled as agreed" or in some cases, "paid in full" or "settled in full".

Now your credit report will show a $0  balance and your credit will slowly improve as your debts are paid!

Finally, after examining your first two options, you may be forced to seek BANKRUPTCY for protection from your creditors.

There are basically two forms of BANKRUPTCY available to most consumers:

Chapter 7 or Chapter 13 bankruptcy

Before considering bankruptcy, you should consult a Bankruptcy Attorney.

Look for a local bankruptcy attorney who specializes in bankruptcy.  Many law firms try to be a "one stop fits all" firm and that is not for you!

Click here for a FREE, NO-OBLIGATION CONSULTATION.

WE CAN HELP!

A wage garnishment can be devastating!

Here are 3 tips on how to stop a wage garnishment:

1.  DON'T IGNORE A SUMMONS!

There are several steps that a creditor must take before they can apply for a writ of garnishment.

First, a creditor must hire an attorney that is licensed within your state to file COMPLAINT with your local, county court.

A COMPLAINT is an official/legal statement that you owe a certain amount to someone.

For example, let's say you have a Visa card and due to a severe financial circumstance...

• Loss of employment
• Illness
• Divorce
• Death of a spouse
• Disability

... you find yourself unable to make any payments.

After a few months of calls and letters (HOW TO STOP COLLECTION CALLS), a creditor may choose to file a complaint.

Once the complaint is filed, a SUMMONS is prepared and delivered to you.

The SUMMONS will state that the creditor (called the Plaintiff) will state exactly what you (the Defendant) owe.

It will also state that you have a certain number of days to give an ANSWER.

An answer, is a legal document that you file with the court (yes, there is a significant fee to file an answer) whereby you state why you do not owe the debt.

But, in 99.9% of the time, most people know they owe the debt.

Unfortunately, this summons and legal procedure could have been avoided if you had contacted the collector or a Debt Management Company .

2.  YOU SHOULD TRY TO NEGOTIATE A SETTLMENT OR STIPULATED AGREEMENT BEFORE THEY MOVE FOR A DEFAULT JUDGMENT.

Once a complaint has been filed and a summons delivered, the creditor or collector has had to pay extra money to the court/attorney/summons delivery company, etc.

They may not be in a postilion to offer much of a settlement, but you should always try.

If a settlement cannot be reached, most of the time a STIPULATED AGREEMENT can be arranged.

A stipulated agreement is an agreement that you make to pay back (usually 100%) of the debt plus fees and interest over a certain length of time.

The reason you would do this is to avoid the court awarding the collector (Plaintiff) a DEFAULT JUDGMENT, which will be awarded to the plaintiff by default, since you are not going to contest that you owe the debt.

It is only AFTER the judgment is awarded that the creditor can apply for a writ of garnishment.

My point is that you shouldn't PANIC just because you receive a SUMMONS and/or a JUDGMENT.

We have been able to help hundreds of clients avoid wage garnishment, but the key is to TAKE ACTION!

I know we are talking about WAGE GARNISHMENT, but once a judgment is awarded, a collector can come after your BANK ACCOUNT....UNLESS...

3.  MANY SOURCES OF INCOME ARE EXEMPT FROM WAGE GARNISHMENT:

Here are a few of the types of "income" that are exempt from garnishment in Oregon:

• Social Security
• Supplemental Security Income (SSI)
• Disability benefits
• Welfare or any public assistance
• Spousal or child support
• Pensions (public or private)
• Veterans benefits
• Disability proceeds from a life insurance or disability policy
• Cash surrender value of life insurance
• Many others (click to see complete list)

As of May 1, 2011, anyone applying for Social Security Benefits were required to have their checks direct-deposited to their bank.

As of March 1, 2013, anyone who had been receiving their Social Security Benefit checks by mail had to switch to a Direct Deposit with their bank.

But, there was another very important law passed on May 1, 2011. 

If a bank receives a garnishment order (only after a judgment was awarded the creditor), the bank cannot freeze or release money that came from social security benefits if the government deposited the benefits directly into your account within two months prior to garnishment order.

After receiving the garnishment order, the bank must know perform a two month "look back" check to determine the source of funds in your account. 

The bank must report to you within a few days of their "investigation" and let you know what they plan to do.

WORD OF CAUTION....

• Social Security (or other retirement benefits) are not protected from payment of:
• Child support
• Alimony
• Federal and/or State Taxes
• Federally insured Student Loans

One final warning about protecting your Social Security and/or other Retirement Income from garnishment..

• 1.  Do not co-mingle your Social Security Benefits with other funds.  This could remove the exemption!
• 2.  If you transfer money from the account that received the Social Security Benefit to another account (a savings account for example), that account will not be protected!

If you have questions or could use some advice, please let us know! We've been helping people with severe debt issues for a long time, and we can help you to.