What do you think about
the Better Business Bureau?

The Better Business Bureau or (BBB) has been operating for
many years to look over consumer and business complaints whether it is
land-based or web-based. Through this organization, people are more aware of
the dos and don’ts when it comes to consumer-business relations.

Nowadays, the logo of BBB in business establishments and online shops remains the proof of
honesty to consumers. On the other hand, more and more complaints are being
shown on the web about the organization’s one-sidedness when it comes to
business grading. Some people believe it’s true but others remain faithful to
BBB.

The Better Business
Bureau

Although BBB looks over the business all over the country
(land-based or web-based), it’s an organization that’s not affiliated with the
local, state, or federal government. In fact, it has nothing to deal with any
government-based consumer protection agencies. This makes BBB a private
organization that may seek its funds through membership fees. Better Business
Bureau located at different states or regions work independently from each
other.

This creates a number of directors and staffs for each location –
although, each BBB division must meet the general requirements of the
organization. Most people who run the BBBs in different locations are composed
of executives of several corporations, legal experts, and even community
leaders.

Ratings

Years ago, there were only two ratings that a business or
company can get from BBB – it was satisfactory or unsatisfactory. Of course,
having a satisfactory rating means that your business is good for consumers and
you are mostly referred by others on a land-based or web-based medium. On the
other hand, having an unsatisfactory rating would mean that your business is
already receiving lots of complaints from consumers (maybe because of false
advertising, scam, fraud, or rip offs). With this, people are able to identify
the good and bad side of businesses.

Nowadays, BBB revised the rating system into A+ to –F rating
system. This is a more comprehensive rating system that will let you know the
good and bad side of a particular business. A business with “B” rating for
example, is generally good for consumers but it may have some down sides such
as poor customer service. If a business is rated “A+”, you can be assured that
it is true to its consumers and there’s definitely nothing to worry about as
you perform transactions with it.

How does it Work?

Since BBB focus on consumer protection, it works as a
mediator between the complainant and the business or company owner. It provides
services to resolve the dispute with processes involving the council members of
the Better Business Bureaus. While most complaints addressed to businesses are
resolved within the BBB, some cases such as medicine or law-related cases are
usually passed to other associations that specialize in these fields.

When the BBB receives a complaint, it immediately contacts
the business or company owner about the dispute. Then, the BBB will proceed to its
mediation process unless the dispute is medicine or law-related. Arbitrations
handled by BBB are low-cost or no-cost. In fact, non-members can also get the
services from BBB if a consumer filed a complaint to a non-member.

Through the process of reviews and dispute resolution, the
BBB will be able to rate a business with its new rating system. With more
unsolved complaints, you’ll definitely have a low rating from this consumer
protection organization. If your business was able to resolve the dispute together
with BBB, your ratings might not be affected at all.

Complaints against BBB

Although BBB is a consumer protection organization, it’s also
flooded with complaints from consumers and businesses alike. This is because of
the increasing number of fraud companies and businesses (from both land-based
and web-based) that bear the BBB logo. With this, lots of people were alarmed
and questioned the legitimacy of BBB when it comes to consumer protection. In
fact, some people over the web expressed their views about BBB in blogs and
forum websites.

The first thing that you have to watch out is phishing sites
that mimic the BBB website. With this, cyber criminals can get personal
information from consumers and business owners that can be used in illegal transactions.
It’s very important that you check the BBB website first whether it is legit or
not – this way, you can protect your information and avoid getting involved
with illegal activities on the web. This year, there are already lots of people
being victimized by these phishing sites. The Better Business Bureau is aware
of this and warns the public about scams that are abundant on the web.

Calls from BBB

Some people were contacted by a BBB representative about its
membership and how you can get the advantage of bearing the BBB logo on your
website. These calls were alarming since most people were asked to give credit
card and bank account numbers to become a member of the said organization. If
you haven’t confirmed the true identity of the person (who suddenly calls you
about the membership fees of BBB), it’s very important not to give any personal
information.

There were calls from legit BBB representatives that were disputed
because of solicitation through the use of credit cards. After asking questions
regarding the person’s business (such as the tenure and nature of business),
the representative wanted to solicit money for the membership fee of Better
Business Bureau – through credit card or check by phone.

Questionable Rankings

There are also questionable rankings coming from the BBB that
were further investigated by curious consumers and business owners. There was a
time that a fraud company on the web was given a BBB logo (with an “A” rank)
just after paying the monthly “membership” or “subscription” fee. While others
– without a BBB logo in their websites; suffer from bad rankings given by BBB
because of being non-member, illegal sites are ranked favorably just because of
paying BBB fees.

With this, the BBBs reputation is becoming more questioned in
terms of consumer protection. If this continues, more and more people will be
victimized because of one-sided rankings given by BBB. Since most people
nowadays still trust BBBs policy in consumer protection, it will be a big mess
in the future if lots of scam or fraud sites give membership fees to BBB and
bear its trusted logo.

There is one scenario on the web that two popular markets on
the same location are ranked by BBB. One store had a BBB membership and the
other one didn’t – with the same kind of consumers because of the similarity in
location, both would have the same numbers of complaints and resolved disputes.
The catch is; the BBB member had a better score than the non-member because of
unresolved complaints (which seems impossible to happen).

Resolved Disputes

Another scenario on the web is a complaint issued to a
company that’s a member of BBB. The person filed a complaint to the car company
because it was demanding for fees on a $500 dollar car part – although the
broken part was just a small fuse. With all the paperwork on this issue, that
person grew tired of addressing the issue to the BBB and the organization
marked the issue as “resolved”. With this, the car dealing still had a “B”
rating.

These days, it’s really best to have your own research first
about a company especially if it obviously boasts for its excellence in
rankings especially from BBB. This way, you can take your worries away from
scams especially if you have read the details coming from the personal
experience of other people. There are lots of review websites on the web that
you can use other than to trust consumer protection sites (which may not be
affiliated with government agencies).

How to File a Complaint
against BBB

If you wish to file a complaint against the BBB in your area,
you can always contact the CBBB (Council of Better Business Bureau). You can do
it by faxing and mailing your complaint (must be Certified Mail and Return
Receipt Requested). After passing your complaint, the CBBB will review your
complaint and address the BBB in your area about it. This will take about 30
days until the dispute is resolved or not.

When the complaint isn’t resolved with the CBBB, you can
still pursue it by addressing the complaint to The Office of the Attorney
General in your state. This office has received numerous complaints about the
malpractices of BBB regarding consumer protection so expect that the office
will be very familiar with your issue. Of course, you don’t have to expect
faster results since this office is usually overworked with few staffs
involved.

There are other ways of filing a complaint against the Better
Business Bureau such as filing it in the Federal Trade Commission (FTC) or
getting the case into court. If you’ve been getting unfair ratings for your
business or you’ve been scammed because of the one-sidedness of BBB to its
members, the best thing you can do is to file a complaint immediately.

With all of the complaints being held against BBB, you might want to check out review sites
that present personal experiences with a particular company or business instead
of trusting questionable consumer protection organizations.

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H & I Credit Solutions

Credit Reports In Los Angeles

New Consumer Law 2012

AB 22–
Chapter 724 – Civil Code §1785.20.5; Lab. Code §1024.5

Effective
January 1, 2012

Summary: Prohibits an employer or
prospective employer from using a consumer credit report for employment
purposes (with certain exceptions when it is allowed).

Background: The federal Fair Credit
Reporting Act and the California Consumer Credit Reporting Agencies Act
authorizes the use of consumer credit reports for employment purposes under
certain requirements. For many years, employers from various sectors have run
credit checks on job applicants.

The New Law: Prohibits a current or
prospective employer to use a consumer credit report for employment purposes
unless applicant is applying for or is currently holding the following
positions:

• Managerial position.
• Position with the California Department of Justice.
• Sworn peace officer or other law enforcement position.
• Position that involves regular access to the bank or
  credit card information, social security number, and date of birth of any
  one person.
• Position in which the person is named a signatory on
  the bank or credit card account of the employer.
• Position involving the authority to conduct certain
  financial transactions on behalf of the employer.
• Position that involves access to confidential or
  proprietary information.
• Position that involves regular access to cash totaling
  $10,000 or more.
• Position for which the information contained in the
  report is required by law to be disclosed or obtained.

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The last thing a consumer needs when struggling financially is to fall into the hands of  a shady credit counseling agency. If you’re considering using a credit counselor, shop around, and ask each agency the following questions. It is very important you protect yourself as much as possible. There are legitimate credit counseling agencies out there you will just have to find them.

More importantly, be sure you are comfortable with their answers before you book that first appointment. A legitimate credit sounseling agency is always more interested in your bottom line than theirs.

• Is the agency affiliated with a national body such as the National Foundation for Credit Counseling (NFCC) that requires strict quality, financial, and ethical standards for membership? Examples of such requirements are annual audits by an independent CPA, written action plans provided to each consumer, and consumers provided with statements at least quarterly.
• Is the agency accredited by an independent third party? Self-accreditation is not the answer you want. An example of a reputable third party accreditating body is the Council on Accreditation (COA). Such accreditation signifies that appropriate checks and balances are in place to protect you, the consumer.
• Is the agency a 501(c)(3) nonprofit community organization? Being a nonprofit does not guarantee that the agency is legitimate, but it is a step in the right direction.
• What is the composition of their Board of Directors? Board members should not be paid by the agency, should
  not be family members or friends, but should represent a wide cross-section of the community and civic interests.
• What services does the agency offer? A wide-range of services is a good sign. This could include: budget counseling for those who are not in debt; debt counseling for those who may need professional assistance digging out; housing counseling for pre-rental, pre-purchase, first-time homebuyer, reverse mortgage, and foreclosure prevention; and the mandated bankruptcy pre-filing counseling and pre-discharge education.
• What are the fees associated with the services provided? The agency should be forthcoming about fees, and no fee should be assessed prior to the service being provided. Be wary if the agency says their fees are voluntary. Any set-up fee or monthly fee should be reasonable, usually defined as $50 or less, with monthly fees in the $25 range. The agency should be willing to waive all fees in cases of true hardship.
• What delivery options are available to you for counseling? Does the agency offer in-person counseling? Counseling by phone? Internet counseling? Is the channel that’s most appealing to you offered?
• Is the counselor assigned to you a Certified Consumer Credit Counselor? You want someone qualified assisting you with your critical financial decisions. NFCC certification means that the counselor has passed a rigorous battery of tests measuring their financial knowledge.
• Does the agency provide educational classes or workshops? Are any of these tools offered online? Is there a fee to attend? The absence of any true education offered to the general public is a red flag.
• Will the agency work with all of your creditors? Some agencies only work with creditors who agree to make a payment to them. A legitimate agency will take a holistic approach to solving your financial distress.
• Is there a minimum amount of debt required to be counseled? True credit counseling agencies will work with you regardless of how large or how small your debt may be.
• What debt relief options are offered? If the only tool is the Debt Management Plan (DMP), keep shopping. A DMP is a useful tool, and is often the appropriate resolution. However, each consumer’s situation is different, thus the solution should be customized to fit their specific needs. A one-size-fits-all approach signals that you should continue your search.
• Are the counselors compensated for writing DMPs? Any such incentive is not a part of a legitimate agency’s pay to their counselors.
• How long will your counseling session last? Don’t be tempted by “drive-by” counseling. A counselor simply cannot do an adequate intake of your income, expenses, and debts in a short amount of time. An initial session length of at least
  one-hour is standard.
• If you go on a Debt Management Plan, how soon after receipt of your monthly payment will it be disbursed to creditors? The success of a DMP depends on timely, consistent payments to creditors.
• What happens to your first payment? Believe it or not, some agencies keep the consumers first payment and consider it a donation. Be sure to ask about this.
• Will the full amount of your payment be disbursed to your creditors? The full amount should go toward the repayment of your debts, with no portion going into the agency’s pocket.
• How will your deposits be protected? Ask for written evidence that the agency is bonded or insured to protect the consumer from fraud or the agency’s own financial difficulties.

Your last step when selecting a credit counseling agency is to check with the Better Business Bureau and your state’s Attorney General to see if there are unresolved complaints about the provider you are considering. Anyone can file a complaint. What is relevant is how the agency resolved it. But you also have to be careful with the BBB as they have some shady tactics as well. Your best bet is to ask around or investigate the credit counseling agency online.

Legitimate credit counseling agencies counsel and financially educate millions of consumers each year, making financial stability a reality in their lives. It all starts with selecting the right agency.

Asking the above questions, and receiving the right answers, will ensure that your credit counseling experience is a positive one.

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SCRA Brief
People in the military service are bound to several obligations too – such as credit card and rental payments, mortgages, insurance, and income tax payments. In the line of service, these service members are able to postpone these obligations and dedicate their time for their duties. This came through because of the Servicemembers Civil Relief Act – it applies to those who are about to enter, called to, or deployed service members.

The SSCRA and SCRA
Before the Servicemembers Civil Relief Act (SCRA), there was the SSCRA or Soldier’s and Sailor’s Civil Relief Act. This was created about a decade ago to help service members with their obligations as they about to enter or get deployed in duty. With this act, service members will be able to have reduced interest rates on mortgage and credit card payments. Service members can also avoid eviction (if they are renting a residential property) if the rent is less than $1200 a month. Along with this act is the delay of any civil court action such as divorce, bankruptcy, and foreclosure proceedings.

After a few years of implementation, the SSCRA has been expanded and improved to provide the increasing demands of service members. Thus, the SSCRA became the SCRA or simply Servicemembers Civil Relief Act. The service member is definite as any person who is a member of uniformed services in the country – such as army or naval forces. This act applies in the United States – it includes the states, political subdivisions, and all places that are subject to the jurisdiction of United States.

About Evictions
The service member and his/her family (dependents) may not be evicted during the period of service. This means, the landlord (if the family of a service member rents a residential property) can’t evict the service member or his/her dependents during the time when the service member is in line of duty. This will apply for service member rents a house or apartment less than $2400 a month (the limit was extended from $1200). Without a court order, the service member will have no worries of such especially in the time of service.

On the other hand, a person who takes part with the eviction knowingly or attempts to do so will have penalties mentioned in the act. If the landlord requests for eviction in court, the court has the power to request the service member to settle things in favor of each sides. The proceedings may take about three months unless the court decides to cut it short.

About Installment Contracts
The SCRA also impose a legal action about the protection of service members from installment contracts or lease. This applies when a service member purchases an installment contract of a property before entering military service. These contracts are described as the ones applied on real properties (this includes vehicles).

There are also limitations in this act that’s mentioned in section 107 of SCRA (this is also called the Waiver of rights pursuant to written agreement).When a hearing occurs based on SCRA’s implementation on installment contracts, the court has the power to require the service member to pay his/her obligations to resume the ownership of a property.

About Insurance Policies
SCRA also protects service members from insurance policies. This applies not only to the insured, but also the insured’s representative including the beneficiaries. With this, the service member will have an insurance coverage protection that will not exceed to $250,000 or any amount that has the maximum limit of a servicemember’s Group Life Insurance. Of course, the service member must pass an application first to the Secretary of Veterans Affairs first to get this benefit.

The application of the insurance protection must be handled by the service member, the service member’s legal representative, or the insured’s beneficiary. In the application, the applicant must fill up the required forms along with an acknowledgement that the insured’s rights in the insurance policy are subject to and modified by the provisions of the insurance protection.

About Taxes
Along with the protection from insurance policies, rents and installments comes the protection of a service member from tax – this falls on the service member’s personal property, business, or any property before entering the line of duty. With this, the service member may not or postpone tax payments if court determines that the service member doesn’t have the ability to pay because of entering the service.

Advantage of the new SCRA
There are many advantages along with the new SCRA (compared to the SSCRA a decade ago. One major advantage is the expansion of the servicemember’s protection from eviction (if one has to pay rents on a residential property from less than $1,200) to $2,400. This act also gives the service members the right to terminate a house lease if a permanent station order is given (this applies for 90 days or more).

As a young act on service member protection, the SSCRA didn’t really clarify the provisions on credit obligations. This is cleared up by the SCRA wherein it states that the limit of credit obligations imposed on service members will not have more than 6% interest. In addition, the act also imposes a reduced repayment scheme during the credit’s payment period. In the SCRA, the service member also prevents double taxation – this might happen if one doesn’t have a permanent residence.

SCRA Simplified
The first thing that you might think about is the person who can benefit from this act. Obviously, the service members – military, naval or armed forces personnel, can benefit from this act. The SCRA is a signed act (this means that it is already part of the law), last 2003 that opened a lot of opportunities for service members in the country.

There are provisions on the qualifications of a service member who can benefit from this act. One main provision is that it only provides for the people in active duty, enlisted, appointed, or inducted to the regular branches of the United States military services. This also applies to the mobilized National Guard and Reserve units around the country.

The six percent cap of the interest from loans by a service member can only be applied before he or she is deployed into service. This means, loans conducted by the servicemember’s dependents during the military service is not application for this cap. If a servicemen defaults the loan, regular charges will definitely apply according to the rules and regulations applied by the loan provider. Although the SCRA protects service members from foreclosures or termination of leases, there are still provisions that you have to carry out.

It is very important that you understand your rights as well as the provisions imposed as well. That way, you can also protect yourself from the penalties that the act also applies. Taxation for example, is applied to everyone as a responsible individual of the country. Trying to evade tax through this act is one thing that you must not do. There are lots of things that you should know about the provisions applied on this act so it’s better to check out official SCRA acts that will let you know more about the things and how you can apply for insurance protections.

About the Dependents
Aside from the protection of service members from insurance policies, credit cards, and other financial obligations, the dependents of the service member is also protected by this act. This means, all of the rights of the service member that’s stated in this act is also the right imposed on the dependents. These dependents are wives, spouses, and children of the service member that’s registered though the federal statistics authority or body. A dependent can be officially covered (including illegitimate children) if the service member is providing majority of support for about 180 days prior to the application of the SCRA.

So, what happens if the service member is discharged from service? Well, there are many reasons why a service member is discharged from service – some undergo physical incapability and some may be caused by criminal acts. Once the service member is discharged from service, this act will not act any more. This means, the loan provider can immediately bring the interest rate of the loan back to its original state. For landlords, he or she has the power to evict a service member from his or her rented residential property upon failure to pay for the rent.

It’s really great to know that this act is continuously improving to provide the increasing needs of service members when it comes to financial obligations. In the future, service members can expect a more comprehensive act that will uphold the rights of service members for a more comfortable way of settling their financial obligations because of the services they provide for the country. Now, more service members can take their worries off from their obligations as they perform their duties as part of the protectors of the country.

Application Information
The Armed Forces Legal Assistance Program office is the place where a service member can seek help if the SCRA applies on his/her case. The dependents of the service member can also contact or visit any local military legal assistance offices where they reside permanently or not. Once the case is reviewed by the military office, it will be forwarded to the department of justice about the appropriate actions for the servicemember’s case.

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H & I Credit Solutions

News about identity theft is really alarming – especially if you have received bogus company requests to acquire your social security number and financial accounts. If you really want to keep off from worrying about these things, a credit monitoring service is the best option you can take. It allows you to monitor your credit report for suspicious transactions to proactively address possible identity theft issues. When this happens, it might be a sign that your identity has been stolen by someone.

Understanding Credit Report

Your credit report includes all your financial information – from bank accounts to existing loans, mortgage information, revolving accounts and collection accounts. If you have a good credit score, it will be easier for you to get approved for a loan because lenders will think that you are responsible enough to pay your dues in a timely manner. It also sends an idea that you can manage your finances properly. On the other hand, it’s quite hard to maintain a good credit score especially in the recession period and in fact, more and more people are getting buried in debt because of multiple loans without any ability to pay for it.

If you have a bad credit score, it’s obvious that you can’t get approved from loans with lower rates. There are bad credit loans available these days but it will only make your financial problems worse. The best thing you can do is act on it immediately by managing your finances properly.

You can do this by spending money on just your needs and saving money to settle your loans before the due date. If credit repair is not an option that you want to take, there are some services that offer financial counseling.

Managing Your Finances

Understanding where your money goes (although most people find it challenging) is the best way to manage your finances properly. This is the way of identifying flaws in your spending habits and correcting it immediately. A simple explanation of managing your finances properly is – do not spend more than you earn! Yes – it’s better to save money for future unforeseen situations that you may be presented with.

If you have multiple existing loans, you can also opt for loan consolidation (although it’s not very advisable if you can still manage payments). Loan consolidation combines all your loans in a lesser rate for a longer payment period – it’s harder to pay off since you don’t know whether you will still have your job tomorrow, next month, or next year.

Aside from spending less than you earn, you also have to avoid unneeded loans. These loans are the things that you use for things that you don’t even need – such as traveling, luxury material items, going out to eat all the time or those fancy cars. Another thing that you have to avoid is rolling over loans.

This is because it lets you borrow money and pay for it twice. If you really need to roll over loans, avoid paying for it after the due date – penalty charges are going to make your problems worse. Pay day loans are the absolute worst, please try to avoid them if you can.

Closing Credit Card Accounts

Know-it-all’s would say that closing credit card accounts will allow you to manage your finances properly. The problem with this is that – it affects your credit score in a negative way. When you close credit card accounts, lenders may get the idea that you are a person who can’t handle responsibilities properly. Thus, you credit card score falls and you lose your chance of getting future loans if you need it.

Keep in mind that your credit score doesn’t fall because of their opinion, it falls because you line of credit that lenders trust you with is gone. The biggest problem in closing credit accounts is that it lowers your available credit extended to you. Never close your open credit cards, ever!

The Advantages of Credit Monitoring

When you monitor your credit report, it’s easier to identify things that you need to work on first. If you noticed that your expenses are mostly on your wants, you can easily try to make changes in your lifestyle. There are many credit monitoring services that you can find today – look for the one that doesn’t rip you off in the process.

That’s right – these days, you can’t be too careful especially when you’re trying to find services that will help you to get back on track. When you fail to do your research, bigger problems will most likely present themselves in the long run.

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With today’s economic crisis, there is without a doubt several individuals who are trying to live from pay check to pay check. Meaning, their income is not enough to sustain their daily lives that once they receive their salary, it is all gone in a split second. This is a common dilemma for every individual. Is bankruptcy the answer?

Most of them tend to rely on lending institutions. With these, some may meet their daily needs. However, there are some who become submerge with too much debt that the end point is bankruptcy. When it comes to the point that there is no possible way to salvage your resources, filing for economic failure would be the last resort. Declaring economic failure can be a good thing for some.

Benefits of bankruptcy

In the process of bankruptcy, you will encounter chapter 7. Also known as “liquidation” this type declares that one may have his debts such as credit cards and medical bills forgivin. This is possible if one has not filed any economic failure for at least 8 years. This may help individuals deal with business and family related debts. This will give you the most protection in terms of your debt collection.

Chapter 7 will also allow you to keep your not liable properties. These properties include; motor vehicles, clothing, furniture, appliances, pension plans and retirement plans. Filing for chapter 7 would definitely save you from deep trouble.

Aside from freeing yourself from debt, you can also save your house when declaring economic failure. This is possible through chapter 13. Also known as “personal reorganization plan”, this chapter declares that one may pay their debts through future income instead of selling their assets.

This will allow you to provide an organized plan to settle your debts within three to five years. This chapter is recommended for individuals who have troubles paying their mortgages. However, this is only possible if you still have a job that allows you to receive a monthly income.

Get a fresh start and your life back upon declaration of bankruptcy

Despite the circumstances that declaring economic failure will bring upon you, there are still chances to restore your finances. Though it may seem absurd at first, it is possible since you can still start all over again. Once you’ve filed for economic failure, you will be protected from any debt collectors. With that, you can be assured that you have new beginnings.

Getting over with your economic failure is up to you. Once these situations happen, there are only two possible ways you can handle the situation. Either you stand up and surpass every obstacle that comes your way, or, another option you can do is to feel low and continue living your life with embarrassment and failure.

Most individuals think that declaring economic failure is the end. However, the truth is with determination you can still pull yourself up and become more experienced. Keep in mind that you learn through your failures. Experience is the greatest knowledge one can attain. Learn from your mistakes and avoid repeating history.

Consequences of declaring economic failure

It is true that once you’ve declared bankruptcy, you can be cleared of debts. However, provisions are set for you to follow. First, the exception of taxes, alimony, child support and student loans from being cleared and these exceptions must still be settled even with great depths.

Second, declaring economic failure will be kept a record. This entry on your credit report will last for 7 to 10 years. Once this situation occurs there may be a hard chance for you to get a job especially when you’re unemployed. Applying for a loan will also be hard for you as well. This will inform lending institutions that you failed to pay your debts. This means that when you filed for bankruptcy, your only option is to work hard and avoid creating further damage by applying for another loan.

Though declaring bankruptcy can be a wise decision, it is highly advised to prevent this from happening. Calculating every angle on how this may occur, it all comes down to the main reason of overspending. Living above your means will only give you uncontrolled financial problems.

A piece of advice is to spend your money wisely and saving today will be good option. With today’s unpredictable environmental conditions, there is no way of telling when or where you may get in trouble. Having sufficient funds may save you from debt and worries.

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Education is a necessity for an individual to acquire a high paying job. Today, a standard requirement for employment is at least college degree. For most people, they ignore the value of education for various reasons. However, study shows that the highest viable reason is finances. It is a mere fact that a college degree will cost you fortunes. Aside from that a master’s degree is now a requirement.

All in all that would require thousands of dollars. As a solution for individuals who wants to progress; grants, scholarship and student loans are offered for those who deserve it. This will enable aspiring individuals to pursue their chosen career in life.

Types of student loans

A student loan is defined as credit accounts that grant students the privilege to study with given the sufficient funds to sustain obligatory fees, course-related fees and living costs. This loan is paid once the student graduates. If you are planning to apply for a loan, there are two primary types of student loan, the federal and private loan.

The federal loan, as the term implies is a government oriented program. Under this program there are three types of loan available. First is the Perkins loan. It is a type of loan has the lowest interest rates and is offered to students that has extreme hardship in their finances.  However, only a little amount is allotted for this type of loan thus only few are granted. Another type under the federal loan is federal plus loan.

The distinct characteristic of this loan is that it is also applied to student’s parents who wish to attend and obtain a college degree. However, taking things into consideration, a credit report is review before one can get approved of this loan. Lastly, the Stafford loan is authenticates and governed by the federal government.

This type of loan has limits. Dependent undergraduates, meaning students that receive financial support from parents can loan $5,500 to $7,500. For independent student, their loans can range from $9,500 to $12,500. This type of loan can also be applied to dependent students who have parents who want to apply for a college degree. For graduate students, you can borrow a maximum of $20,500.

Private loans on the other hand are obtained from lending institutions that are privately owned. A common example is your bank. This type of loan is hard to acquire. It is for the main reason the like all loans, several factors are taken into consideration. The biggest impact would be your credit report or credit score.

Aside from these requirements other substantial data are required.  This may be hard to obtain for individuals who have previous credit accounts, bankruptcy reports and other types of obligations.

Basic steps in applying for a student loan

The very first step one should know is the university or institute you want to enrol. Make sure that your chosen university is supported by the loan. Although almost all learning institutions support student loan, there few that are not designated for a certain type of loan. The next step is to evaluate your credibility.

In this step one must gather all necessary requirements. Not all students are granted with student loan, you might check diligently all requirements needed and provide it accordingly. This will save you some time and effort applying for something you cannot obtain. Make sure that you are qualified.

Once you’ve compiled all requirements, you can now start filing for an application. Applying for a student loan has two separate steps. There is one allotted for full-time time students and another one for part-time students. Depending on your chosen type of lending institution these steps may vary. When everything is done, you will now wait for your assessment and approval.

In some cases that you don’t get approved or you have obtained insufficient amount, you can always make an appeal. This process would at least take 6 weeks. This can be done if you have special conditions that would give you an edge compared to the other unapproved loans. Reassessment can also be done if your situation has changed from the time you have applied. There are limitations when it comes to appeal. An example for this is grants or loans from previous loans and standard allowances.

With this, education will no longer be for the privilege. It is also acquired by individuals who are determined to change their future and aim for success. Determined and hardworking individuals would find a way to achieve their desires. With different types of student loans offered, you can surely find a way to explore all possibilities of obtaining knowledge.

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When it comes to your credit, there are several factors that may affect your credibility. Child support for one has a big impact. Keep in mind that child support issues will always be a part of your income until your children reaches legal age. If you’re planning to apply for a loan or you already have a credit line, you must always take into consideration your ability to support your child. The very main reason is that child support and credit will always be incorporated with one another. Delinquent child support comes with serious consequences.

Overview of credit score

By definition, a credit score is a statistical analysis of an individual’s credit reports. Its primary role is to ensure bank and lending institutions of your capabilities to repay your debts. Under this report, they will base what interest rate to apply and how much your credit limit would be. Having an impeccable credit score would be a good help for you.

Banks and lending institutions are not only the ones who base their lender’s capabilities with credit score. Other companies such as telephone companies, insurance companies and government departments rely on credit score to evaluate your competence to pay your obligations. As you can observe, almost everyone rely on credit.

From buying a house to their phone bills, one must present a credit report.  Maintaining a reputable credit report would not only allow you to loan, it will also provide financial aid when needed.

Understanding how credit report works

For you to fully manage your credit and credit report, one must understand the underlying details of how credit report is computed. Basically, credit report is like a grading sheet. There are certain percentages allotted to a specific category. Once each category is computed, the total score would range from 350 to 850.

For the breakdown of your credit report, 35% of it is based on your payment history. In this, your score will vary depending on how many late payments you have acquired and if bankruptcy has been filed. Recent delinquent payment will result to higher damage or worsen your overall score. Another 30% is based on your current debt. This will inform lending institutions on how much credit you have already accumulated. From car loans to credit cards, all of it will be tallied.

The next is 15% that is based on the length of time that you are on a credit.  The longer the length of your credit the better your score will be. This is because with longer time, your credit report will also be full of data to compare. Next is 10% that is based on new credits made.

Recently opened credit account would result to negative impact for you. Lastly, another 10% is based on the type of credit you currently have. This will aid in raising your score by showing your ability and experience to pay your debt from all sorts of credit types.

How child support affects your credit?

As mentioned above, child support and credit is very much incorporated. Child support is like your personal debt to your children. It will be computed as a current credit for you. Maintaining a child support is manageable as long as you take your responsibilities into serious matter. However, if you missed even a single payment it will hold you consequences.

For one, delinquent child support will last in your credit report for at least 7 years. As simple as it sounds, your credibility will be greatly affected with this. As high as 20 to 30 points will be deducted in the total score of your credit report. As a general rule, all unpaid child support will be reported on the 3 major national credit bureaus.

Second, even if one declares bankruptcy, obligations for child support will remain. There is no way out of you obligations once the court orders you to provide it. As long as you have child support obligations, you income would be subjected to debt to income proportion.

As you can see, child support and credit score will always be a matter of great consideration when filling for a new loan. Though today, credit is the number one source of financial aid. One must avoid any circumstances that would result to any form of credit. Especially in situations that you are under a court order to pay for child support.

With this, try to prioritize you children first before your wants. It may seem unjustifiable for some but these things must be done. It’s a child’s life at stake and you as a parent have every responsibility to nurture and bring your kid a brighter future.

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You credit score is one important factor that lenders consider if they are going to approve your loan application or not. In most cases, they try to assess it using their risk management test that will allow them to identify your financial strengths and weaknesses. Most people try to repair their credit scores before they go for loan applications – a better score increases the chance of getting approved in the process. Since identity theft and fraud is getting popular these days, more and more people are trying to hire credit monitoring services to identify suspicious financial behaviors that’s an indication of someone using your credit or bank account.

What is Credit Score?

Your credit score is the result of your financial assessment – whether you are responsible enough to pay for future loans. It includes all your credit and bank accounts, existing loans, defaults or foreclosures. The more negative things listed in your credit report, the lower your score will be. When this happens, you won’t be able to apply for future loans – this is because lenders will most likely consider you as a higher risk. Thus, you will need to repair it by managing your finances properly and paying dues in a timely manner.

If you don’t have any idea about repairing your credit report, there are lots of services that offer credit repairs. These professionals will be able to give you advice on how to manage your finances properly and identify flaws in your credit report. The first thing that these financial experts will tell you is to spend less on your wants and focus on your needs – this will give you some more money to pay your existing loans before its due date. When they identify flaws in your credit report (such as expired reports on foreclosures or defaults), they will immediately report it and get it fixed.

Repairing Your Credit Score

While there are lots of credit repair services offered online these days, you can still try to do it all by yourself. Of course, you will need to educate yourself first before you start repairing you credit score. You can start by assessing your finances and try to identify unneeded expenses from the ones that you really need. If you’ve tried to loan for a vacation trip, you won’t need one if you really want to get back on track.

The last thing that you want to do is to try to loan for something that you can’t afford – when you start to repair your loan, don’t take loans to pay off existing loans. Rolling over loans can give you some money to pay for your needs. On the other hand, it will just make your debt bigger in the process.

Another thing that you have to consider is the accuracy of your credit report – report inaccurate information immediately! This way, you’ll be able to increase your chances of getting approved for a loan if you need it in emergency situations. This will also keep you off from bad credit loans with enormous rates that might create bigger problems in the future.

The Benefits of Credit Monitoring

When you try to repair your credit score, it’s also practical to sign up for credit monitoring services. This will allow you to stick with your plan and keep yourself motivated as you get back on track. Another benefit from monitoring your credit report is that it keeps you off from inaccurate information and identity theft (this is a serious problem that’s being experienced by many because of carelessness). Aside from avoiding these circumstances, you will be able to embrace financial freedom without keeping you worried in the process.

What is identity Theft?

Identity theft is a process of obtaining personal information that allows someone to access all your financial accounts. Since there are many cases of identity theft these days, you don’t want to be too careless in giving out personal information to someone you don’t know or trust. If you enjoy shopping online, it’s very important to use secured payment procedures instead of giving out bank statements.

It’s also best to keep your personal information if the transaction doesn’t require it – if your personal information is vital to the transaction, see to it that it can’t be sold or given out to someone else. There are many security policies on the web that you can check out first before you proceed with transactions. Lastly, purchase items online from a shop that’s favored by most online shoppers.

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Economic crisis can lead to severe financial dilemma. These may lead to various situations. The worst possible thing that might happen will be bankruptcy. However, not all individuals result to impoverishment, there may be times of delinquent payments. While others go to lending institutions for financial support. Some may find a way to pay their debts while other manages to budget their finances.

How do bankruptcies occur?

In situations where an individual is incapable of paying his debt can file for economic failure. This allows an individual to have a fresh start in terms of their finances. However, there are risks involved when economic failure is filed. These risks will be further explained in the later part.

Causes of economic failure may be of varying reasons. Most of them revolved under uncontrollable loans and credits. One example is medical debt. Hospital bills are highly expensive. When a person doesn’t have sufficient funds or savings account, financial drainage is unavoidable. Unemployed individuals may also experience economic failure. Today, everyday expenses will cost you fortunes. If don’t have any source of income it will lead to financial drainage or loans.

The worst thing that could happen is loaning with high interest rates. If you are planning on loaning, opt for lenders that offer lowest rates. Think about it, most rates are applied monthly. Once you’ve started your loan, you have to pay it as soon as possible. In some cases people just pay for the interest instead of the principal amount. Economic failure will soon follow if you can’t escape or fully pay your loan.

Effects of bankruptcy in your life

Once economic failure is achieved and filed it will stay on your credit reports for at least 10 years. Credit reports are not only important during loans. It also has an impact during job applications. An employer who sees economic failure in an applicant’s credit report would automatically declare incompetence.

There are other circumstances that can be affected by your economic failure. You may not be eligible to buy a house, obtain another loan or even get insurance.  Credit reports have high impact in your life after filing for economic failure. Not only would you be eligible in every financial support there is, your personality would also be downgraded. However, for some individuals they take it as a learning experience. Once they incurred economic failure, they try their best to get back on the road and avoid making things worst.

As general reminder to the public, declaring economic failure will not free you from all debts.  Taxes, student loans, child support and alimony are still paid regularly. As much as possible, find means and ways to provide these payments to avoid double jeopardy.

How to avoid economic failure?

The number one and most reliable way of avoiding economic failure is to live below your means. Budget your income. As much as possible, you must try to save half of your income for unexpected events. If you have some money you can apply for an insurance policy. They will serve as a financial support during accidents and hospitalizations. When purchasing for your things, keep in mind to choose only those that are needed. Budgeting is an important factor that would determine the success rate of this process.

Second thing you can do is to avoid debts or loans. When you are in deep trouble and loans or debts is inevitable, try asking your friends or family first. You can borrow some money without interest rates. Don’t be enticed by lending institution’s promotional statements. If you are qualified for bank loans you can try to apply for it. Compared to lending institutions, banks have lower interest rates. When applying for a loan, always compare interest rates. Opt for the lowest rate and loan for the needed amount only.

Third is to pay for your debts as early as possible or if you already have the money. Monthly payments maybe not seem as a big deal. However, if you meticulously compute your interest it has already doubled your principal loan. This are the common trouble one may encounter during loans. Once you’ve loaned a large amount of money, getting out of your loan would be a challenged.

Lastly, one way to regulate your funds is to avoid doing risky business transactions. It may be true that all business is risky. However, if you observe that your loss would be uncontrollable then as early as possible stop any transactions. Gambling is another problem that causes bankruptcy. Try to evade your bad habits. At this point you already know how to handle your finances. Use your critical thinking in every situation you are about to face.

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