A “fresh start checking account” is a bank account that you can apply for in case you have been banned from opening new checking accounts. This usually happens when your name is reported by a financial institution to Chexsystems, and the consequence is that you can no longer open a standard checking account. Bank accounts have no bearing on your credit score, but banks have their own system to keep track of who is a desirable client and who’s not. In that regard, Chexsystems is the banking industry’s watchdog, in that it compiles a database of people who, for various reasons have been reported by the financial institutions that they’ve had problems with in the past.

You may be reported if you have been identified as someone who is involved in fraud. In the majority of cases, though, people land on that list because of overdraft fees that have been left unpaid at one or more banks and they decided to close your account and report you. It can also happen that you don’t have an unpaid balance, but because you abuse your debit card or checking account (repeated overdrafts), the bank decides that you’re a risky client, closes your account, and reports you as a risky client.

Once your name is on the Chexsystems database, most banks out there won’t agree to open a checking account for you, and your name remains on the list for five years. We say “most” because there are banks that don’t stop at the Chexsystems report and will consider opening an account for you even with a negative Chexsystems record. They realize that everyone makes mistakes and give you a fresh start, so to speak, hence the name “fresh start checking account”. In reality, this is just a fancier name for “second chance checking accounts”; some people also call them “no credit check bank accounts”.

These banks that do not use Chexsystems will forgive past mistakes in your banking history and will allow you to open second chance checking accounts. These accounts vary in terms of what they offer and what restrictions you have to deal with, but in all likelihood you’ll get mostly everything you would have with a regular checking account. As you would expect, most banks that offer fresh start checking accounts place a certain number of restrictions on the features of said account.

Second Chance Checking Accounts

The good news is that most of the basic features of a checking account, such as ATM withdrawals, online bill payments and direct deposits are also applicable to second chance checking accounts. A good second chance checking account will come with a debit card with the Visa or Mastercard logo on it, online bill payment, direct payroll deposit, and in some cases even check writing privileges. You will most likely have to put up with a monthly service fee, but that’s a small price to pay when compared to the inconvenience of not having a checking account.

There are plenty of banks that offer second chance checking accounts, both in actual branches and online. You can get accepted very quickly, especially in the online ones. It’s even possible to find a local bank in your area where you can open a second chance checking account. Those banks are usually referred to as “non-Chexsystems banks” and they’re not that easy to find. Most of the time they don’t advertise it, out of fear that they’d get way more applications that they could handle. Be prepared to have to sit down and explain the origin of your banking problems with someone in the branch, very often the branch manager. In the event that you have unpaid balances at other institutions, they will almost certainly ask that you pay them off and come back with proof that you did so.

Before opening your second checking account, ask whether or not there’s a trial program: some banks can offer to put you on a trial, and after a set amount of months of good history (usually 12 months, sometimes less, but 6 at a minimum), you’ll be eligible for a regular checking account. Banks that offer fresh start checking accounts are important because for many people with bad credit, it’s the only way for them to have access to basic financial services at a reasonable cost.

© Fresh Start Checking Account

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In most cases, medical debt is the result of an emergency situation: you develop a complication from a pre-existing condition, or get into an accident, or otherwise become seriously sick and in a matter of weeks you can rack up a five-figure hospital bill. Medical bills are one of the things that can quickly turn your financial situation from very good to very bad, and they’re actually the main reason why people file for bankruptcy.

Most of the time, they are large amounts: thousands or even tens of thousands of dollars. To further complicate things, they’re somewhat hard to track because you rarely ever get one bill that includes everything. Instead, you might get one from the physician, one from the anesthesiologist, one from the hospital, and so on with every person or institution that you’ve had to go to in order to handle your medical problem.

With all this being thrown in your face shortly after a medical issue, it can be hard to know exactly where to start. More often than not, when you add up the bills, what you get is a total that is beyond what you can reasonably afford to pay over the next several months. Even if you can pay them, it really doesn’t hurt to try and reduce the bill by as much as possible. Well you can take action and negotiate your medical bills, although most people seem to either not know about it or think that they don’t have a reasonable chance of succeeding at it.

What Is Medical Bills Negotiation?

To make a long story short, it’s a process where you or someone else works with the people who have provided you medical services. The goal is to either reduce the total amount you owe, or the required monthly payments that you would have to come up with. This way, you can come up with a plan that is more in line with your financial capabilities. Most people, when faced with a too high medical bill, just figure that they’ll file for bankruptcy and let time take care of it. Well it’s really not the only option at their disposal.

On a side note, one option that should be avoided at all costs is paying your medical bills with credit cards. First of all, you might think you’re paying the bills, but you’re really not. You’re simply changing who you owe money. You previously owed money to medical service providers, now you owe money to one or more credit card companies. Secondly, when you do this, it’s very likely that the credit card companies will charge you a higher interest rate than the previous creditors. Finally, when you transfer the debt to one or more credit cards, you may become ineligible to get medical financial aid because that debt no longer lowers your gross income. So you’re really hurting yourself instead of improving your situation.

The first thing to do is to resist the temptation to pay off the smaller bills and leave the larger ones to deal with later. This is often a mistake, since large amounts tend to be transferred to collection agencies more quickly than smaller ones. Then it’s time to put yourself in a negotiating mindset. Think about it, if you can negotiate with the seller when purchasing a home, and you negotiate on the price of a car – therefore you can surely negotiate with your doctor or hospital, or medical providers regarding medical debt.

How Do You Negotiate Medical Debt?

Important caveat: knowing which bills to negotiate is very important. If you are still receiving care by a doctor, it makes sense to pay the full amount. Otherwise, you could risk being denied future service, or having to prepay for services with that doctor.

That being said, you need to go through all the bills you’ve received, line by line. The reason is that billing mistakes are pretty common and you don’t want to have to pay for any services that weren’t actually provided to you. You can sometimes shave a nice amount off the initial bills just by doing this. Also, although this post is mostly targeted towards people who are uninsured, in the event that you’re faced with a large bill in spite of insurance coverage, you need to know what expenses of the bill will be paid by your insurance provider, and exactly how much of the bill they will foot. This way you’ll know how much will come out of your pocket.

One way to handle medical bill negotiation is to do it yourself. Sure, it will require a bit more on your part, you’ll have to put in some work to find the right people to talk to, get the responses that you’re looking for, and work out an arrangement. Here’s a suggested approach.

Make sure to be delicate in your negotiation approach. For example, if you want to have an overdraft fee or a credit card late payment fee to be waived, you probably won’t be successful if all you do is yell at the customer service representative. Conversely, if you keep calm and polite, yet firm, you have a fighting chance. The same holds true in this situation: explain to your hospital or doctor why you can’t pay. If your reasons are valid or reasonable, they will usually understand and be open to discuss the matter further with you. You effectively need to prove that the charges received are too high for the income and expenses you have. Remember to keep your calm through the process. If you get angry, the negotiation will pretty much be over.

Now when it comes to the actual process, you need to understand that the sooner you tackle the problem, the better your chances are of a favorable outcome. Secondly, make sure to keep in contact with your creditors (everyone you owe money to such as physician, doctor, medical organization or hospital) and carry a record of all your previous conversations in regards to the concerned matter and the name of the officers you spoke with. Make sure you document all the things you did, when you did them, and the outcome. If you have a call with a creditor, then try to record it if your state allows it as 35 states do.

What do you want out of the negotiation? First, you want to have as many medical fees or underpayment penalties associated with your balance removed or reduced. Secondly, you want to negotiate a payment plan. Your physician, doctor, medical organization or hospital stand a better chance of getting paid that way, so they will often times take smaller payments over a longer period of time. Try to get an agreement for a reasonable payment plan that you can afford.

If you do reach an agreement with your creditor (payment plan or payment in full), document it and send it to your creditor. If you are paying by check add to it “Cashing Check Constitutes Payment In Full.” Third, never take the first offer you get if they are eager. You need to sense how eager or quickly they respond with an offer because if you can get a 2nd or 3rd one they usually improve. The tough part is knowing when you should take an agreement or request a better offer. Lastly, if all else fails (but that’s really a last resort ploy), you can always point out that with bankruptcy they won’t get paid. This will usually soften their stance toward a payment plan. One important part to keep in mind is that you must reach a compromise with the biller. Have them reissue the bill showing the reduced amount and then promptly pay it.

Unfortunately, sometimes doctors and hospitals may not want to negotiate with you. At this point, it’s best to have a professional medical bill negotiation company take care of it for you. This type of process has become very common, and thus, many people have started to take up careers where they simply help people re-negotiate their hospital and doctor bills. The advantage here is that you will be able to get the best deal possible without any real work on your part. Obviously, the disadvantage is that you will have to pay for such a service, but it may be worth it if your medical bills are substantial.

You can also contact charity organizations for help. There are organizations that exist which may provide some financial help for you. You can find them online and the recommended site below provides some resource links to them. Another option is to apply for Federal or State medical financial aid. Before doing that you have to make sure that you are eligible for getting the aid and usually each State’s website explains what eligibility requirements are. Otherwise, it will be a sheer waste of your time. Medical financial aid is provided by the state, mandated by the Federal government through a program called Medicaid.

No matter how you go about it, you should at least give negotiating your hospital and doctor bills a shot. You never know what may be able to be worked out, and as mentioned earlier, we could all use a little extra money each month! And remember that waiting for your medical bills to be sent to a debt collector and then trying to settle is a mistake because it will cost you money and your credit will be trashed.

© How To Negotiate Medical Bills

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Many people dream of starting a small home-based business and grow it to the point where it can not only support them and their family, but ultimately bring them success and financial freedom. After all, pretty much every big business out there had humble beginnings. But since starting a business usually requires a lot of money (ask people who are looking to open a laundromat business), people tend to gravitate towards those businesses where you don’t need a lot of money to get started.

One such opportunity is the business of selling candles. Very often, people dismiss it as something that’s not very viable, but it’s actually a pretty good business model. Candles are what is called a consumable item, meaning that once it’s completely burned, it has to be replaced. Plus they’re not expensive items. That means that people don’t feel uncomfortable spending money on them. So you’re selling a cheap item, that needs to be replaced often. Not a bad proposition if you ask me.

As for the question of “where’s my target market for selling candles”, here’s the answer. People don’t really give a lot of thought before spending a couple dollars on a few candles. Because it’s such a cheap purchase, they don’t feel guilty about it. And that’s very good news for you. This is also a business that doesn’t require a lot of money to get started. It’s pretty common to hear people say that they started their profitable candle selling business from their kitchen table and grew it from there. If you’ve got a creative side, then it’s even better: you can be as creative as you’d like. Just keep in mind that your prospective customers must also like your creations in order for your candle selling business to make money.

There are countless places where you can sell your candles. Once you have some inventory, either from candles you make yourself or candles that you order from a wholesale vendor, then you’re ready to start selling. Start off with your friends and family, and also offer your product to local shops where people know you and will support your business. It’s a good idea to try local craft shows, which usually happen once or twice a year. This is a good setup if you like traveling. You can set up a calendar of craft shows happening around the country and be there to sell your candles.

If you’d rather handle the business without all that traveling, auction sites offer an excellent outlet for your candles. eBay is one of the most visited websites on the web, and you can set up shop there and make as much money (if not more) than you would by other means. The only caveat to the eBay option is that with lots of traffic comes lots of competition from other sellers trying to do the same thing you are. Of course, there’s always the possibility of opting for a lesser known auction site. There will be less traffic, that’s for sure, but there will also be less competition, so you might end up winning by getting a larger piece of a smaller pie.

Whether you’re selling candles that you make yourself, or are selling candles that you buy in bulk, make sure that your product is of good quality. The reason is that word of mouth is the best advertising you can possibly get, as people who have bought your product and enjoyed it will share it with their friends, family, and neighbors, giving you high marks for quality. Some of them will try your product based on just the recommendation of someone they know and trust. You don’t have to do any selling, your satisfied customer has taken care of that for you.

Should you choose to sell your candles online, but want more control than you’d get with being an eBay seller, then you should definitely consider having your own site. This is even easier if you choose to associate with any one of the big candle selling companies out there. As a part of your package, they offer you everything you need to set up a professional online presence. You get assistance from choosing your domain name to setting up a shopping cart so you can accept credit card and check payments online, and including an “admin” interface to allow you to upload photos of your products and their description. As said previously, most of the established candle selling companies have that sort of assistance built into their packages.

If you treat candle making and selling as a hobby, it will bring you hobby money; if you treat it as a big business, it will bring you big business money. Big corporations are into candle making and selling, so why shouldn’t you go for a piece of the pie? Candles are sold pretty much everywhere these days: specialty stores, home furnishing shops, mail order, craft shows, auction sites, gift shops, and so on…

In summary, a candle selling business is a good choice for starting a new and profitable business. You can make a profit with your candles, just remember these tips and plan your business accordingly.

© Make Money Selling Candles

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How To Open A Laundromat

Interested in starting a business that pretty much runs itself? If that’s the case, then it would be wise for you to consider opening a laundromat. For various reasons, a lot of people do not own their own washer and dryer. For example, there’s sizable demand for laundromats in areas where there are lots of renters because a lot of times the buildings don’t provide those amenities. Also, anywhere there’s a high concentration of students, laundromat services are going to be needed.

These are just a couple examples. The bottom line is that you want to set up your laundromat in an area where You’ll have a steady clientele of people who regularly load up their dirty laundry and either walk or drive to the nearest laundromat to wash and dry their clothes.

First of all, you need to plan ahead. As pointed out earlier, you need a location with a high volume of traffic. Without traffic, your laundromat business venture will be short-lived. The issue of parking can be important, but at the same time, it can also be a non-issue. If your laundromat is in a suburban area where people primarily drive to it, then lack of parking space will kill you, as people will simply drive to your competition instead of looking for parking space. On the other hand, if you’re near apartment buildings and/or student housing, then parking is not something you’ll really have to worry about, as most of your customers will be within walking distance. Of course, you should never underestimate the importance of assessing the real NEED for your business, in the location you’re targeting. Analyze your competition and how you’re going to carve your own space.

Decide whether you wish to set up your business from scratch or want to buy an existing laundromat? In any case, prepare a detailed business plan for each option as this gives you a detailed idea of what you will need to invest in your business. If you’re buying an existing laundromat, some of the things you will need are a business license, tax ID# if you have employees, a fictitious business name, environmental health permit, safety and fire inspections, just to name a few. There are lots of things to consider and all fees and requirements vary by county or state.

If you’re starting from scratch, your initial investment on new or old washers and dryers will be your main expenditure. The decision to go with new machines as opposed to older ones is a trade-off. Newer machines will be more expensive but require less maintenance and vice-versa. Most likely, this decision is going to depend on how much you can afford for your initial investment. In case you’re taking over an existing laundromat, you don’t have to make this decision, but if you’re buying new machines, you also have to decide if you’re going to get coin-operated machines or smart card operated machines.

The location where you set up the laundromat should (ideally) have two entrances; having two entrances in case of emergency may reduce your insurance premiums with some companies. It’s a good idea to have the laundromat in an existing location with the necessary connections already installed (water, electrical, plumbing, and so on). If those connections are not already there, you will have to spend extra to get this job done, which will drive your startup costs higher. In any case, it’s strongly recommended that you get three (3) sets of quotes from different contractors, so you can get a good idea of how much you’re going to need to build the laundromat.

Here’s what you’re going to need, in terms of setup:

• You will want a location that can accommodate the size of your business. You need to decide how many washers you want, as well as dryers. Make sure you find a place that has plenty of room after all the equipment is set up. You don’t want your customers bumping into each other. Laundromats get hot when the dryers are running, even with air conditioning. In the summer heat, tempers can flare if they don’t have enough room to maneuver while doing their laundry. Your location needs to accommodate tables for your customers to fold their laundry. You will need several of them. You may even want a play area for the children. That will increase the size of your location. And it must have restrooms.
• It was mentioned earlier that you can have either coin operated machines or smartcard operated machines. If you have coin-operated machines, then you’ll need a change machine that can accept up to $20 bills. If, on the other hand, you have smartcard-operated machines, you’ll need a smart card center machine for people to recharge their cards.
• It’s recommended that you have one little sink for people to pre-treat their clothes, areas for folding clothes, and rolling carts.
• Have one vending machine on the premises with some snacks, and if you can, a vending machine with laundry supplies, one arcade game, and a TV. You should also sell related merchandise such as collapsible hampers or laundry bags.
• You need some variety in the size of your machines: low price range basic washer and dryers, higher priced stainless steel washers and dryers, a couple giant dryers. When you decide to open a laundromat, make sure you have enough washers and dryers so your business can grow. You want several different sizes of washers. There are the regular top loaders, front loaded double and triple washers. This will handle all of your customer needs, but will also increase the size of the location.
• In terms of personnel, you’ll only need one person, with some paper change for large bills, wiping down washers and keeping the place tidy.

Other stuff that needs your attention:

Maintenance: How will you maintain and repair the equipment? Do you plan to have a repair service come in and fix the machines when they break down? You will also have to plan for a significant amount in order to turn on the local utilities along with repair and maintenance of your machines. You will need to get a regular service contract with the person who installed your machines as this turns out much cheaper in the long run. You will also need lots of supplies to stock your shelves or the dispensing machines, depending on your laundromat’s setup.

Business entity: Incorporate the business before doing anything to shield yourself from any potential liability issues.

Profitability: You might not want to talk to your direct competitors, but how about talking to others already operating the same kind of business, in a comparable setting, to find out if they are profitable, or just “breaking even”?

Ownership: Do you plan to buy the building, or be a renter, paying monthly rent, to a landlord ?

New or existing business: Is the location set up as a laundromat NOW, or will you have to buy and install the equipment at your cost ?

Equity/Financing: How much of your OWN money are you going to invest, and how much “actual cash money” do you have , to pay for the activation of the water, gas, and electrical utilities, and to advertise your new business, and put up a proper sign on the front of the store ? Have you secured financing?

Legal requirements: Have you found out what city or state permits and licenses are required, to conduct this type of business, and what about liability insurance and property insurance coverage? You might need to contact the local city council or the necessary licensing agency to find out what you will need to set up your business. You also have to contact the local Franchise Tax Board to get the required permits. This will help you to buy goods without tax for your business.

Ongoing expenses: You won’t just need one months rent, you’ll need rent, deposit, and some places require you to prove you can afford 6-12 months of rent before letting you rent from them. You’ll need money for all the licenses and forms, insurance, plus all those washers and dryers. Not to mention money to fix them. When used that much, you’ll be amazed at how abused they become. Water and electricity will be your biggest ongoing expenses. Don’t forget about them.

If any of these questions are new to you, or you didn’t know about them, you are not ready to get into a business, yet. On the other hand, other than that person who really is there for constant upkeep, there is no supervision needed. That’s what attracts a lot of people to the coin-op business!

Starting A Small Business

Starting a small business is a serious endeavor that not should really not be taken lightly. Often, it’s the best vehicle to realize dreams such as financial freedom, the ability to travel, or to spend more time with your family. If you take the time to do a couple things before really launching your business, you will give yourself a better chance to hit the ground running and really lauch a successful business.

Importance Of A Business Plan

The first area is your business plan. Your business plan is your company’s calling card. It allows you to see your business through your investor’s eyes. As the name suggests it is a plan of your business; your communication tool; selling your marketing, sales and operations. You should focus on exactly what you want to achieve, where you want your business to go and how you plan to get it there. Projected sales and monthly expenses will also be included in your plan. All of this information will influence your choices, including the type of location you will be looking for.

A business plan is the key to long term success for new and old businesses. Your business must have a foundation to start from and you have to give your business time as success will take longer then a few weeks. Your business plan is a framework which your business must operate within. It will ultimately determine whether your business succeeds or fails. It’s often the key to securing financing. Preparing a comprehensive plan will not guarantee success in raising funds or mobilizing support, but having no plan at all will more than likely result in failure.

Importance Of A Marketing Strategy

The second is the marketing plan that you are going to use in order to ensure that your business is noticed. Marketing strategies are the methods that can often determine the success of your business. They should be considered carefully, as it is important that the right combination be established to ensure the success of your products and services when starting a home business.

When first starting a small business many people may rely on minimal marketing. This is generally due to financial concerns however, marketing is especially important when a business is first starting out. You want to draw as much attention from as many different sources as possible. There are plenty of options that are available for starting businesses that may not have a large budget to spend on marketing but still want the advantages that come from marketing via the internet.

When starting a small business (such as a laundromat), it is important to plan how you want your business to run, as well as how you want to present your business, products and services to the public. Planning before you launch your business is one of the best ways to ensure your business is primed for success.

© How To Open A Laundromat | Starting A Small Business

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So you want to know how to generate wealth? Well I have good news and bad news. The bad news is, it’s not going to be easy. The good news is, it’s not impossible at all: tons and tons of people have done it before. In reality, it’s very simple. What confuses most people is when they’re told that it’s a simple process. They hear “simple”, and they think it means “easy”. But “easy” and “simple” are really two very different concepts.

No matter how much material is written about how to generate wealth, there’s only one way to successfully do so: make more money than you spend. As long as you manage to have more money coming in than is going out, you have what I like to call the basic setup of wealth generation. If you want to become wealthy, you need to create a surplus that you can then use for savings and investment purposes. There are two ways to create that surplus. You either reduce your spending (given the same income level) or increase your income (given the same expense level).

Admittedly, or at least in the short term, it’s easier to reduce your spending so you can generate more wealth. But the flaw with reducing your spending is that there is only so much you can do about it. Some stuff, like food, shelter, and clothing for example are necessities. What this means is that there will come a point where you can no longer reduce your spending. Now don’t get me wrong. If you want to be wealthy you will have to control how you spend your money, because the natural tendency is to spend what we earn (and then some, in some cases). Instead, the point was that while you can (and should) reduce your expenses, you won’t get that much farther ahead unless you generate more income.

There are countless ways to make money. All you need is a couple good money making ideas and the discipline and perseverance to follow through with them until you succeed. You will probably have to get a little creative and understand the mindset of the people that you’re targeting in your next business venture. In case you’re not the entrepreneur type, you can update your skills and your resume and go for a higher-paying job. The beauty of also exploring the “make more money” side of wealth generation is that contrary to the “reduce your spending side”, its upside is theoretically unlimited. No one can tell you how much more money you can make!

Money Making Ideas That People Use To Generate Wealth Even In A Recession

Money Making Idea 1: Online Marketing

The Internet has created a way for lots of people to start making money and create income streams through a number of online marketing techniques. In many cases, although they sound really new, they’re merely variations of proven, centuries-old marketing techniques. The main difference is that the Web has considerably shortened the time frame it used to take to start generating money. In the Internet marketing realm, the most popular ways for people to make money are pay per click advertising, affiliate marketing, and direct product sales. In order to make money, website owners have to develop methods to drive visitors to their websites. Once that’s taken care of, then there’s plenty of ways you can monetize those online properties.

Money Making Idea 2: Passive Income Streams

There are different views about passive vs. residual income. My favorite definition of passive income is this: passive income refers to income that is received without a direct participation in a business concept. So with that in mind, I think of stocks, bonds, and investment vehicles where you receive money even though you’re not actively involved in running the business. Read Stock Market Success For Beginners for more information.

Money Making Idea 3: Residual Income Streams

My idea of residual income is that it’s income that is recurring over time, that you get as compensation for something that you did once. You have nothing to do after that to keep it coming, or you have to do very little. Insurance agents are a good example of people who earn residual income from insurance payments that their clients make over time. Similarly, people like actors and singers earn residual income from their movies/TV shows/album sales, years after having put in the work.

Money Making Idea 4: Leveraged Income Streams

Leveraged income refers to income that you make by working with or through other people. For example, online affiliate marketing is one of the most widely used strategies. In this case, you have companies paying other companies or individuals to post their ads on their website. If the website owner has a visitor that clicks and buys something from the posted ad, the website owner will be compensated by the affiliate company.

Money Making Idea 5: Real Estate

It’s commonly said that wealthy people either make their money in real estate, or keep their money in real estate. If you want to get rich by investing in real estate, there are several methods you can use, including (but not limited to) buying to rent, buying and selling foreclosures, fixing properties up to sell and looking for undervalued properties to take advantage of the appreciation or value opportunity. Although many beginner real estate investors think of the big money they’re going to be making, most real estate investors will get their beginnings with a single property, and then build up their investment portfolio over time. Buying to flip allows to make quick, one-time profits; buying to hold allows to build a stream of passive income, especially in you hire a management company to take care of your properties and collect the rents.

Money Making Idea 6: Network Marketing

This is obviously not for everybody. Yet it’s undeniable that many famous wealthy individuals around the world have gotten their start in network marketing. The concept is still rather new, and the negative publicity from people who have failed at it causes people to still see it in a negative way. But network marketers can earn money in several ways, including directly selling the products and services, a percentage of what their down line sells and through residual income from product or service re-orders. Building a network marketing business requires a substantial amount of time investment in the beginning, before the time demand eventually decreases and the income stream grows and grows and grows.

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Surviving a credit crisis is pretty hard. What makes it harder for a lot of people, though, is that they don’t act as soon as trouble rears its ugly head. If you’re finding yourself in a situation where you’re having trouble keeping up with your credit card bills, for whatever reason (and reasons are plenty in this economic crisis), you should know that there are places you can turn to. Among others, you can get help from government agencies and nonprofit groups.

The kind of help you’re going to be looking for is going to depend on how dire your situation is. We’ve divided what we call plastic problems in three categories, in order of increasing severity: if you’re a little late on a payment, if you’re consistently late, and if you’re drowning under credit card debt. Here are your options in each case.

Sporadic Late Payments On Credit Card Bill

If you can’t pay your credit card’s monthly minimum, or if your payment is already late, the first order of business should be picking up the phone and making a call to your credit card company. Your credit card issuer will talk to you unless you’ve been missing quite a few payments. This is a very competitive industry (after all, there are banks that offer secured credit cards to people with bad credit) and getting a new customer costs those companies upwards of $100. So they’ll do what they feel is right (within reason) to keep their current customers, especially when they know that it only takes a web search to compare credit cards and see what the competition is offering.

The main factor that’s going to determine what treatment you get is your payment history. If you’re only been late once or twice in the past twelve months, credit card issuers may waive the late fee. But before they agree to do so, they will either have to see you make the payment or they will ask for very precise details as to when said payment will be received. You might think this is trivial but taking this step will save you more than the late fee. Should you fail to take care of this, your issuer will increase your interest rate to penalty levels (up to 29%), which triggers what the industry calls “Universal Default“: the issuers of other cards you hold increase your interest rates too.

Chronic Late Payments On Credit Card Bill

Let’s say your situation is different and you’re consistently making late payments, and coughing up hefty fees in the process. The problem might be a simple cash flow issue, meaning that your credit card payment might be due at the same time as all your other bills and you don’t have enough money left to pay it, or it might be due at a time of the month where you simply have no cash, like a few days before you get paid. In these situations, you can ask your credit card company to reschedule your due date so that your payment falls at a time that makes it easier for you to pay for it.

If you’re heavily in debt and are having trouble making your minimum payments, your best bet would be to ask your credit card issuer to lower your interest rate. You might need a couple weeks of preparation for this one, but it’s really not complicated. Simply keep all the credit card offers you receive over a few weeks, and call your credit card company. Just make sure that you’re made good on your payments for the last six months. Ask to have your interest rate lowered so you can keep making your payments. Many credit card issuers would rather agree to that than lose you to a competitor.

Drowning Under Credit Card Debt

The least enviable situation is the one where you’re just staggering under a mountain of credit card debt that you just can’t keep up with. If that’s your situation, then getting professional help might be the best thing to do. Look for a certified credit counselor. He/she will examine your income versus your expenses, help you address your financial problems, and on that basis, will negotiate with credit card companies on your behalf. In many cases, you will be able to work out a satisfactory deal where your interest rate is lowered, new penalties are eliminated, and sometimes the balance that you owe is reduced.

It’s important though to keep in mind that the Federal Trade Commission (FTC) warns that not all credit counselors are reputable. You should really do some due diligence to find one that will help you out instead of leaving you worse off than when you contacted them. Another issue to contend with is the tax implications of having a portion of your debt forgiven or written off. When you settle your credit card debt and a portion of it is written off, that forgiven portion is considered by the IRS to be taxable income for you and you will have to pay taxes on it.

When it comes to dealing with debt problems, swift action is often the best thing to do. Knowing your rights and getting the correct information also helps. As I like to say, when it comes to financial matters, ignorance is not bliss.

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What Is ChexSystems And Why Do Banks Use It?

ChexSystems Inc. is a reporting agency that provides a continually updated deposit account verification service to its members, which are banks, credit unions, and other financial institutions (there are few banks that do not use ChexSystems). This network of financial institutions all contribute information to the company concerning negative information on checking and savings accounts. This information is then shared to assess the risk tied to prospective customers opening new accounts and to screen out applicants that they’d rather not have as clients. For instance, people who repeatedly write bad checks have their information recorded in ChexSystems, since the service helps the financial institutions to be aware of fraud and other attempted abuses of the system. Viewed from this angle, it’s a very useful service.

Yet it is entirely possible to end up in ChexSystems without engaging in criminal activities. If you had a checking account that was overdrawn and failed to pay the negative balance in time, it’s very likely that the bank will report the incident to ChexSystems. It’s important to point out, though, that ChexSystems itself does not actually have the power to deny or accept a given account. The decision to report you relies solely on the financial institution, who forwards the names and addresses of account holders whose accounts have remained unpaid. All they do is provide your financial history to financial institutions to which you apply to allow them to make an informed decision. But since Chexsystems is also licensed as a debt collection service, they are allowed to take the necessary measures to attempt to collect that debt.

Every report that is submitted to them remains on file for at least 5 years, unless the financial institution that originally reported the information requests that it be removed, or ChexSystems becomes obligated to remove it under applicable law. Just to clarify the latter case, ChexSystems, much like the three major credit bureaus, is regulated by the Fair Credit Reporting Act. This law (the FCRA) requires Consumer Reporting Agencies to let you dispute any information that’s inaccurate or incomplete and to delete anything they can’t prove after investigation.

If you have overdrawn your bank account, the bank will send you a notice in the mail or try calling you to get you to pay up so that you have a positive balance. If you choose to ignore the bank, well just like a creditor reports to a Credit Reporting Agency, the bank will report you to their own agency and that is Chexsystems. Once this is done, over the next five years, you will have a very difficult time opening up an account at any other financial institution partnered with ChexSystems. Since the vast majority of financial institutions deny such customers the possibility of opening bank accounts, being reported to ChexSystems is a very serious matter that complicates your financial life to no end.

How To Find Out If You’re On ChexSystems’ List

Most people find out that they’re on ChexSystems once they go to a bank to open a new account, only to have the branch manager or customer service representative come back to tell them that they are denied because they are in ChexSystems. Pretty embarrassing. A more dignified way to find out is by ordering your ChexSystems report, a copy of which you can order online or by calling and following the automated instructions. It will typically take a couple of days before you receive it.

Once you have your copy, go through it with a fine-toothed comb. It will include the following sections: your name and “consumer identifier”, one or more items of “Reported Information” (this is the bad stuff that is being reported about your banking history!), one or more “Inquiries Initiated by Consumer Action” (these are things you have allegedly done that caused someone to pull your Consumer Report), one or more “Inquiries Not Initiated By Consumer Action” (these are reports pulled by others about you without your direct permission), one or more “Retail Information” items (from other check-writing databases such as SCAN), one ore more “History of Checks Ordered”, and then personal information about you, including your Social Security Number, and Drivers License.

How To Be Removed From ChexSystem’s List

If there is any error or inaccuracy in your report, you have a right to dispute it and ask that it be corrected or removed. Each item that you can have removed from your report puts you one step closer to being taken off the ChexSystems bank list. After you have carefully reviewed your report, it’s time to get to serious things and write a dispute letter. Gather all the information that can prove that the items are wrong. You should especially focus on the items in the section called “Reported Information”. If there are reports of debts you owe to banks that you know you have paid, gather your proof (do you have a receipt for paying the debt?, etc.). Collect all this information for your letter.

In this letter, you will write to ChexSystems and point out all of the errors or mistakes in your report, and ask them to reinvestigate those items and correct your report. Remember, the FCRA requires that credit reporting agencies take action within 30 days to reinvestigate the items you point out to them, so make sure to be clear and detailed in your letter. But please do not do this if you know for a fact that your file is accurate. Your inquiry will be tossed as a frivolous one.

Alternatively, you could possibly call your bank and try to work something out. It really depends on the bank. You can ask your bank if they can have you deleted from Chexsytems in you pay off your overdraft and see if they agree. If they do, get the agreement in writing because there’s no way to prove a verbal agreement. Once again, if the bank agrees to ask to remove you from Chexsytems if you pay the debt, get that agreement in writing in case ChexSystems asks for it.

If you have been reported to ChexSystems but still have open checking accounts, make sure you do not close them.

Banks That Do Not Use ChexSystems

If all else fails, you’re going to have to find banks that do not use ChexSystems so you can still have a checking account: banks that supposedly will not run a Chexsytems check on you when you apply for a checking account. These institutions are prepared to take on prospects with less than stellar credit ratings. Some will approve the application without placing too much weight on the ChexSystems report. Some will require a 1 year waiting period while you pay off your outstanding debts before opening an account.

The Internet is chock-full of offers for “banks without Chex Systems”, so you need a few pointers to navigate the offers. Before you get involved with any company that claims to give you a fresh start checking account, run the following tests and make sure it passes them with flying colors:

1. Make sure it’s an FDIC-insured bank. If you decide to open a bank account with an institution that isn’t FDIC insured, you could basically lose all of your money if that institution goes out of business. So it’s extremely important to verify the banks status before you open an account. The insured limit was previously $100,000 per person per bank but it has recently been upped to $250,000.

2. If it’s a credit union, make sure it’s NCUSIF insured. The NCUSIF is the credit unions’ equivalent of the FDIC. You should check it for the same reasons stated above.

3. It helps if the institution has a brick-and-mortar branch. Such institutions are almost always more reliable than strictly online ones, although legislation has tightened to protect customers and make online banks more legitimate.

4. Do some background work on the bank. Perform a WHOIS on the bank’s domain name: if it’s registered to a person and not a corporation, you should be concerned. Look on the banks web site. There should be separate telephone and fax numbers, and a legitimate street address – not a PO box. You can always call 411 to confirm that the telephone number matches the address listed, while keeping in mind that some banks have a central location where they answer general calls.

5. Make sure the bank DOESN’T require you to use direct deposit in order to open the account: if you switch jobs, and no longer receive your checks through direct deposit, then you’re basically back at square one.

6. Make sure the institution doesn’t charge you for common items like monthly statements, telephone services, and withdrawals, options that are normally provided for free through regular banks and credit unions.

Banks that do not use ChexSystems are important because for many people who are unfortunate to be on ChexSystems, they’re the only chance to open a second chance checking account. Being without a checking account is financially crippling. Fortunately, most states have local banks that offer second chance bank accounts and you can get around the Chexsystems penalty.

Related resource: Banks That Do Not Use Telecheck

Second Chance Checking Accounts: Banks That Do Not Use ChexSystems

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What’s a Certificate of Deposit Loan?

If you have opened a CD at a financial institution and are in need of cash, instead of paying the early-withdrawal fee (some banks charge up to six months of interest), a very good option might be to get yourself a certificate of deposit loan. A certificate of deposit loan is a secured loan where the owner of the certificate of deposit account is allowed to avail a loan based on the existing CD as collateral.

What Are Certificates of Deposit?

Certificates of deposit (also known as CDs) are one of the best ways to save money and earn a decent profit from interest income. Stashing a few certificates of deposit in your portfolio is also a good way of investing cash, as long as you hold them to maturity. A certificate of deposit is a special type of account that usually offers a higher interest rate than a regular savings account. Investing in a CD means locking in your savings for a set amount of time, usually three months to five years, and in this time span, you’re paid interest based on the terms you agreed on when you opened the account. Like savings and checking accounts, CD’s are protected by federal deposit insurance up $250,000, and are thus pretty safe investments.

Why Get a Certificate of Deposit Loan?

The main problem, though, with a CD is that for the duration of the contract, your money is locked and you can’t get access to it. Savings accounts pay less interest, but your money is available to you anytime you need it. In the case of a CD, if you draw your funds early, you pay a penalty, known as an early-withdrawal fee. If you got your CD from a broker, he may have told you that there is no early-withdrawal penalty. That doesn’t necessarily mean, though, that you can’t lose money by trying to cash the CD early.

Here’s how: if you buy a CD through a brokerage firm and cash it before it matures, the broker may try and sell the CD to another investor. You can benefit from this only if interest rates are lower when you cash your CD than they were when you bought it. It is so because an investor will be willing to pay more for your CD if the interest it pays is higher than what the market is offering. If you have a three-year CD at 5.5-percent interest and you want to sell at a time when the highest rate on a three-year CD is 4 percent, you’ll get a premium for your CD. But if you’re strapped for cash and have to sell when the current best rate on a three-year is 6 percent, there’s less demand for your CD and you may have to sell it at a discount. The money you lose could be actually greater than the early-withdrawal penalty you’d pay if you had purchased the CD through a bank. You could even lose an amount equal to your original deposit. That’s where a certificate of deposit loan might come in handy.

How a Certificate of Deposit Loan Works

As previously mentioned, a good way to avoid paying early-withdrawal fees is to get a certificate of deposit loan. As its name suggests, a certificate of deposit loan is a loan that is granted to you with your certificate of deposit as collateral. If you had opened up a CD and find yourself in a situation that would require you to cash it out (for example after a medical debt negotiation and you have to pay off the agreed upon amount), remember that you still have options. Instead of paying the early-withdrawal penalty, consider borrowing against those funds instead by getting a certificate of deposit loan. You can borrow the money you need at low rates while the savings that you previously set aside will continue to grow. Depending on the financial institution and your credit history, you can get terms up to 60 months and borrow up to 100% of the CD’s face value. For a fixed dollar amount and a specified time period, a certificate of deposit loan may be arranged for nearly any project or purpose and you’ll continue to earn interest on your account while you’re enjoying the benefits of your new loan.

So whether you’re planning on taking a vacation but don’t want to drive up your credit card balance, want to consolidate some of your bills without paying high interest rates, or have to face urgent and unforeseen expenses, you can get a fixed rate and term certificate of deposit loan.

Certificate Of Deposit Loan

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A home improvement loan is a loan whose purpose is to to make repairs, expansions, or improvements to your house or real estate. Simply put, the best home improvement loan rate is the one that produces payments that are low enough that you can meet them with no problem. If you’re looking for low rate home equity loans, it makes sense that you shop around for a while. After all, how do you know you’ve secured THE best home improvement loan rate unless you’ve consulted several lenders and have a reasonable amount of offers to choose from?

You can only get that elusive good rate when you finally meet a lender who’s willing to work with you when it comes to interest rates, repayment terms, repayment options, and so on. And the primary factor for finding that kind of accommodating lender is your credit and whether it’s good or not. This is something that you can easily check, since there are a number of companies that can offer you a free credit report (no trial) so you can assess your credit situation.

Of course, every lender you approach will claim that they’re offering you the best home improvement loan rate for your particular situation. In many occasions, people apply for, and get, home improvement loans but they fail to secure the best possible rate because they didn’t bother doing their homework before applying (getting their credit report) and they didn’t do research after applying (doing some comparison shopping to find the best deal).

One are of concern for people shopping for the best home improvement loan rate is that they fear that doing some comparison shopping with several different lenders will impact their credit score negatively. While this was a concern a couple years ago, the credit reporting industry has adapted and now if you make all your inquiries within a set period of time (15 days, according to many sources), they all count as one inquiry.

Being a savvy shopper can help you secure the best interest rate considering your personal factors. Here’s what you should be doing.

1. Order your credit reports so you can analyze your credit history. If you spot mistakes, take the necessary steps to have them corrected
2. Get your credit scores. If you opt to get the free credit reports that you’re entitled to each year, they will not include your credit scores. For a complete picture, you should get your credit scores too
3. Start your research by selecting banks and financial institutions that offer home improvement loans among their financial products
4. Consult with those financial institutions, give them an estimate of your credit score, and hear what they have to say. If you’re told that your credit score is too low to secure a good home improvement loan rate, ask for advice on how to improve your credit score
5. Make visits to the lenders’ offices and ask to to talk to a loan officer. Ask about how to get pre-qualified for a home improvement loan
6. Don’t make any commitments to any particular lender until you’ve gotten at least half a dozen separate quotes, just state that you’re comparison-shopping so you can get the best home improvement loan interest rate and terms that you’re currently eligible for.
7. Do an Internet search to see what the competition has to offer, you’ll find that plenty of additional options are only a few clicks away. Compare to what you get through in-person visits
8. Study the different interest rates and other repayment terms offered by all the competitors
9. Work your budget and thoroughly review it to make sure that you’ll be able to meet the monthly payments from each offer
10. Once you’ve decided on one that suits you best, pay another visit to that loan officer and see if you can sweeten the deal

As a general rule, if you’re able to offer a collateral, your interest rate will be lower. That collateral can be your house or any other asset you own. The reduced interest rate reflects the fact that the lender’s risk is lessened by the fact that he has something to fall back on should you default on your loan. In those cases, the lender will be more likely to be more flexible in setting up your loan, especially if you have good credit. By the way, if you have good credit, you have even more options, as you can opt for an unsecured home improvement loan. In this case though, keep in mind that your interest rate will certainly be higher.

The best home improvement loan rate (as in, the lowest one) in not necessarily the best deal though. It won’t do you a lot of good to get the best interest rate if you’re expected to pay sky-high fees for late payments, or if your repayment terms are unrealistic, or if you have to pay a hefty penalty for paying off the loan in a shorter amount of time. What you’re loking for is the most flexible terms, along with low interest and low fees, with as little penalties as possible.

That’s the loan you want to apply for.

How To Get The Best Home Improvement Loan Rate

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Creating your own personal or family budget is an important step towards putting together a system to take control of your finances. Yet for many, creating a budget can turn out to be a difficult task. As it turns out, it’s a fairly simple process. And like most people who have successfully gone through it know, setting up the budget is the easy part; the real challenge lies in striking the balance between sticking to the budget and making it flexible enough to accommodate unforeseen events as well as personal changes. There is free home budget software out there to assist you in getting your financial house in order. Here are some of the most popular free home budget software available to you:

Quicken Online

This online tool used to cost $3 a month but is now totally free. It’s a decent offering and its feature list, although not as complete as the standalone version of Quicken, is nevertheless very good. Automatic nightly updates from your bank accounts and credit cards, bill payment reminders via text message or email, and customization options make it a solid choice, although it doesn’t offer advanced features like, for example, investment tracking.

Mint

This site got a fair amount of hype before launch and seems to now have matured into a very good money management option. It’s easy to use and offers very nice features. In minutes you can open an account, enter your bank and credit card info, and Mint will pull all of your balance and transaction information and provide great graphic detail of your financial life. Not only does Mint break down your spending behavior, it will alert you when your balance is low, when a bill is due or when you have overspent your budget. Mint.com also give you personalized money savings tips based on what you’re currently buying.

Geezeo

Geezeo allows you to manage all your accounts, offers mobile access, makes budgeting a breeze, allows you to create and track goals, and to join groups and learn from others. So it does a lot of the things the other financial software options do, with the benefit of active forums and groups to give the site more of a social network feel.

Buxfer

Buxfer lets it users set up budgets, know where and with whom they spent the money, who they owe how much, split bills, assign tags to transactions, settle accounts online, synchronize with different banks and credit card companies and access the service while on move via their iPhones, Twitter or a simple SMS. This software is specifically recommended to the younger crowd. It makes splitting, managing, tracking money easier and lot more fun for its young users. However, the service restricts itself to somewhat simpler tasks. High- end financial planning and advice are not the focus.

Wesabe

Wesabe is a community-based personal finance site which allows users to track their bank accounts while sharing money tips and goals. Wesabe’s strong suit is its tagging system. Everything on the site can be tagged, be it a transaction, a tip, or a goal. The tags are visible to the community and make it that much easier to see what’s “normal” for a spending category, or to get tips and set goals.

Now that you have a pretty good roundup of the free home budget software that’s out there, please keep in mind that they’re just tools.As such, they’re only as good as how good you are at using them. Following are some useful tips to get the best out of them.

Creating a budget can be summarized as a 5-step process:

1. Setting your financial goals: they must be of the S.M.A.R.T variety (Specific, Measurable, Attainable, Realistic, and Time-Limited)
2. Calculating your monthly income: salary, and other sources
3. Calculating your monthly expenses: both fixed and variable expenses. Take ALL expenses into account and set an approximate amount for each
4. Comparing your income to your real expenses. You will have to do what it takes (increase your income and/or decrease your expenses) to AT LEAST balance them out.
5. Follow the evolution of your financial situation and make changes to your budget accordingly

Mistake to Avoid:

If you’re setting up a monthly budget, be careful not to assume that your yearly expenses will be 12 times your monthly expenses. Inevitably, some months you will spend more than others. Think about birthdays, anniversaries, school tuitions, and so on… Notably, in December, you will incur many expenses that you won’t have to face at other times of the year. A good home budget software will allow you to plan a year ahead and will then go from your yearly estimate to come up with a monthly amount. You can also customize them to make up a small savings fund for Christmas, for example, and the monthly contribution to that fund can be added to your expenses.

And now, here are some important tips to help you make the most out of your budget:

1. It’s crucial that you pay yourself first (save) when setting up your budget. Always include a contribution to your emergency savings fund in your fixed expenses
2. Do NOT completely eliminate entertainment spending (concerts, movies, eating out…) unless your situation is really critical. A good approach is to reduce them to a minimum until your financial situation gets better. It’s very important to include those in your budget, otherwise you probably won’t be able to stick to it.
3. Go through your budget line by line to determine the areas where you can eliminate superfluous spending.
4. If you have a surplus after having trimmed your expenses, use half of it to further pad your emergency savings fund; use the other half as extra payment on your debt. If you have no debt, take a stock market for beginners crash course and start investing.
5. Get into the habit of writing down all your expenses. Little expenses that you don’t even think about twice really add up and you might be surprised to see how much money you’re literally throwing away. This money could have been used as further payments toward your debt, or for investing purposes.
6. If your personal budget shows that you’re only getting further and further in debt as time goes by, even after trimming down your expenses to a minimum, maybe it’s time to take a deep breath and look into debt consolidation so you can get out of debt once and for all.
7. Once you’ve paid off one debt, use the available money as extra payment towards other debts. Once all your debt is paid, you can increase your emergency savings fund and/or increase the pace of your investing so you can make your money grow.

Ultimately, the time and effort you put into your budget should help you shape a much brighter financial future.

Mistake to avoid:

Do kid yourself and try to save what’s left over at the end of the month. It simply doesn’t work. Save first (no matter how small the savings), and spend what’s left.

Once again, it’s crucial that you write down all your expenses to avoid reverting to your old habit of spending more than you earn. And if you think you can get out of debt without a budget, think about this: how can you trim your unnecessary expenses if you have no idea where your money goes?

The positive thing, though, is that by deciding to make a budget, you’ve taken one step in the right direction. And luckily, there’s plenty of free home budget software programs that you can use to create the budget that’s perfect for you.

Free Home Budget Software: How To Get The Best Out Of Them

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