Month: June 2011

How to Negotiate with Creditors

Managing financial troubles can be complicated. Unemployment, unforeseen medical expenses, and unexpected increases in living expenses are just a few of the factors that cause many people get in over their heads. When you’re drowning, credit solutions can be hard to find. However, there are ways to negotiate with creditors before your situation gets worse. Contact your creditor immediately and ask about the following credit solutions. The answer may be simpler than you think.

  • Be honest. The best way to facilitate credit solutions is to employ open communication. Your creditors will ask for an explanation regarding your financial troubles, so be clear and concise. Creditors will be more willing to work with you if they have a full understanding of your situation.
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Lower Your Credit Utilization: Tips and Tricks

Maintaining and improving your credit score can seem like a full-time job. Time and diligence are needed, and most importantly, knowledge. If you want to improve your score, understanding the makeup of a good credit report is imperative. For example, something termed your “utilization ratio” accounts for about 30 percent of your total credit score. This number represents the percentage of credit cards and other revolving debt you owe, compared to the sum of your total credit limits. For example, if your four credit cards carry a total balance of $6,000 and your aggregate credit limits are $24,000, then your credit utilization ratio is 25 percent (e.g., $6,000/24,000=.25). One of the best ways to improve credit score health is to creatively manage that ratio. Review the following tips and tricks, and you may find that accomplishing this goal may be easier than you think.

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How to Say No to Cosigning

Every year, thousands of people face the challenging task of trying to rebuild credit as part of their larger credit repair efforts. For those with bad credit, this task can prove impossible without the help of a cosigner. While it may be tempting to help a friend in need, blind trust isn’t the answer. Sometimes, saying “no” is the only option. Still not convinced? Review the issues below and apply them to yourself. You may find your answer easier to stomach.

Illustrate your situation. Good credit doesn’t always indicate financial flexibility. In fact, taking on new debt as a cosigner can potentially hurt your credit score by increasing your credit utilization ratio, i.e., your total revolving debt vs. your credit limit.

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Can’t Make Payments? What You Should Do

When times are tough, the stress of stockpiled bills can be overwhelming, especially when you can’t make the minimum payments. Without a proactive stance and some careful planning, the path to bad credit is a short one. If the walls of your world are closing in, follow the steps below until you can pay your bills in full.

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Collection Agencies and Your Info: How Did They Get It?

Debt collectors are stealthy in their quest for information. Not only will they contact people close to you (embarrassingly so), they will sometimes stray outside of legal boundaries to track you down and inform you of allegedly outstanding debt. Don’t be intimidated by their maneuvers; instead, educate yourself about how they operate and your rights.

Skip Tracing

The collection agencies’ most common (legal) method of gathering information is known as skip tracing. Aided by a search engine, they enter your name, address, or phone number and cross-reference it with your relatives, employers, friends, and neighbors. How do they affiliate these people with you? The answer comes in many forms, including:

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