August 28, 2011

6 Tips To Pay Off Credit Card Debt

| Share

Yahoo Finance has posted a helpful article that provides 6 tips about how you can pay off credit card debt.

1. The first tip makes the very important point that paying off your credit card debt is more so about behavior modification and not just math. Dave Ramsey, author of "Total Money Makeover", suggests paying off smaller debts first, regardless of interest rates, so you will feel motivated to keep paying off more debts, which he calls the "snowball" effect. He also says that you should only pay off a large debt first if it's to stop a foreclosure or if you owe the IRS.

2. However, if you're a numbers person, paying off a large debt with a high interest rate first could be more motivating for you.

"Also, if the account with the highest interest is utilizing more than 30 percent of that credit line, focus on paying that one off first to get it under that threshold," she says. Doing so will improve your credit score since debt utilization, which is how much you owe compared to how much available credit you have, is an important factor in determining your score. The lower your utilization is, the better.

3. It's very important for you to figure out exactly what the charges are if you're planning to transfer a balance from one credit card to another. You have to have a plan of action to ensure that the transfer fees will be offset by the lower interest rate on the card you're transferring debt to. It's also important that you fight the temptation to use your newly cleared credit card and undo all the progress you've made.

4. You have to be careful when moving debts around, though, as it can only be a temporary solution to a long term problem. "The danger of moving credit card balances is that it's easy to start thinking you've actually done something to address the problem," Ramsey says.You still have to pay the debt off, no matter how many times you move it around.

5. Even if you're focused on paying off debts, it's also very crucial to remember to still save money for emergencies. You should have a savings cushion of at least 1 month's income so if an emergency were to happen it wouldn't add to the debt you're trying to pay off.

6. If you have a huge amount of debt, using some of your savings to pay it off can seem like a good idea, but it's important to not drain your savings. "I always recommend having a $1,000 emergency fund while you get out of debt. Emergencies will happen," says Ramsey. Once your debt is paid off you can then shift your focus to saving money to cover a few months' worth of expenses.

If you have had problems with a credit card or a credit report and have questions or concerns, feel free to contact us through our website or by calling 205-879-2447.

You can join our Facebook Fan Page - Alabama Consumer Protection Attorneys where we share useful information about the same types of issues that we cover in this blog.

You can also sign up for our free email newsletter sent out every Thursday morning - we cover topics such as the one in this post. We would love to include you! Just fill out the form below:

Contact Information
First Name *
Last Name *
Email *
Street Address 1
Street Address 2
City *
State *
Zip Code


Posted by Watts & Herring, LLC | | Email This Post

Posted In: Credit Card

August 18, 2011

Demolition: The New Way To Foreclose?

| Share

Time Magazine has posted an article that brings to light a new method that some banks are using to deal with the massive number of foreclosures that are on the housing market: bulldozing them.

According to Stephen Gandel, writer of the original article, there are 1.7 million US homes in various states of foreclosure. Most of the houses are owned by banks, or will be owned by banks after the foreclosure processes. With so many foreclosed houses on the market, it's possible for housing prices to stay down for years.

However, some of these bank-owned homes won't ever be for sale. Banks are starting to call in demolition teams to get rid of some of the least-valuable repossessed houses. For example, Bank of America had plans to demolish 100 foreclosed houses in Cleveland in July alone. Bank of America then donated the land to the local government and has already donated 150 homes in Chicago and 100 in Detroit. BofA says the demolished homes were worth less than $10,000 each.

And BofA is not alone. A number of banks are ramping up their efforts to not just rid themselves of their unwanted homes but also fully dispose of them. Fannie Mae has a program to sell houses to local municipalities for a few hundred dollars. Wells Fargo has donated 800 homes since 2009. While some of those homes have been demolished, a spokesperson for the bank says many of the homes have been given to not-for-profits with plans to renovate the homes, not tear them down. JPMorgan Chase says it was one of the first banks to donate houses it couldn't sell or didn't think were repairable. Since 2008, JPMorgan has donated or sold at a discount 1,900 houses to city or county officials.

The bank is rewarded for donating the property by not having to pay taxes on the property or pay to have it maintained. Because it's a donation, the banks may even be able to use the donation for a tax write-off. Bank of America says demolishing some houses is the best economical option, as some houses aren't worth repairing. Everyone involved seems to like this method. The local government gets land, the bank gets a tax write-off, and housing economists feel that removing homes from the market that have low values or wouldn't sell at all is keeping home prices from going down even further. The most recent housing market data says it would take about 9 1/2 months for the current number of houses on the market to sell. The housing market is considered healthy when there is6 months' worth of sales available.

The big question is if the banks will demolish enough of the least valuable foreclosed homes to make a difference in the housing market. The Obama Administration says it's working on a program to help keep homeowner's facing foreclosure in their homes, which would help by reducing the number of properties the banks would be putting on the market.

Certainly, the idea that we are at the point where banks would be better off knocking down houses than reselling them shows there is still something very wrong with the housing market. But what is clear is that banks and others are at a point where they are ready to try something new to boost the housing market. And that is a good sign for the future.

If you would like more information on foreclosures, please check out our articles The Three Stages Of Foreclosure In Alabama and Wrongful Foreclosures In Alabama.

If you have further questions or concerns, feel free to contact us through our website or by calling 205-879-2447. You may also obtain a copy of our free book on stopping wrongful foreclosures and the problems of hidden fees by emailing us.

You can join our Facebook Fan Page - Alabama Consumer Protection Attorneys where we share useful information about the same types of issues that we cover in this blog.

You can also sign up for our free email newsletter sent out every Thursday morning - we cover topics such as the one in this post. We would love to include you! Just fill out the form below:

Contact Information
First Name *
Last Name *
Email *
Street Address 1
Street Address 2
City *
State *
Zip Code


Posted by Watts & Herring, LLC | | Email This Post

Posted In: Mortgage/Foreclosure

August 17, 2011

Bankruptcy -- Should You List Your Potential Lawsuits?

| Share

Sometimes when we file bankruptcy we are doing it because of the wrongdoing of someone else. Maybe a drunk driver ran a red light and hit us and we can't work. Maybe a debt collector called our work and got us fired.

Any potential lawsuit we have should be listed in our bankruptcy papers. If we don't list them, then we may have lost the right to bring the suit forever.

Here is the concluding paragraph to a good short post by David Leibowitz:

So if you are filing a bankruptcy case, list all your assets. And that includes all lawsuits you have against anyone for anything. It includes any claims you have even if you don’t know what their worth. It includes any claims you have even if there are significant defenses to the suit. Don’t get thrown out of court by playing it cute in your bankruptcy case.

Excellent advice.

Posted by Watts & Herring, LLC | | Email This Post

Posted In: Bankruptcy

August 13, 2011

Items To Never Carry In Your Purse or Wallet

| Share

Fox Business has posted an article that gives some pointers on what you should never carry in your purse or wallet on a daily basis. Some personal items you may carry can significantly increase your risk of becoming a victim of identity theft if your wallet or purse is stolen. Some of the items that can put you at risk aren't surprising, but others are.

1. Your Social Security Card
You may carry it around in case you need another form of identification, but really it's better to just memorize the 9 digits and leave the card at home in a safe place. If your SS Card falls into the wrong hands, someone can take a loan out in your name and cause all kinds of identity theft issues.

2. Your Passport
If you're travelling outside the US it's much safer to lock your passport in the hotel safe and instead carry a photocopy of it along with your driver's license instead. If you're mugged overseas and your passport is taken, it can turn into a vacation nightmare. If you're travelling domestically, your driver's license is a sufficient form of identification; leave the passport at home.

3. PIN Numbers and Passwords
Most PIN numbers are just 4 digits, but some people like to write them down and keep them in their wallets. Some people also write down the alarm code for their house, so in the event of their wallet being stolen they've given the thief a free pass to their bank accounts and access to their home. If you can't remember all your PINs and passwords, it's much safer to store them on a password protected phone rather than writing them down.

4. Non-Password Protected Phone
Most smartphones today allow people instant access to their bank accounts and even medical records. Even if you only have your phone configured for email, the thief could still do a search for PIN numbers or ATM passwords. If you do store important personal information on your phone, be sure to have your phone password protected so a thief will have to wipe all your personal data to be able to change the password to use your phone.

5. Checkbook
Your checkbook contains a surprising amount of information about you- your address, your phone number, your bank account and routing number, and possibly an imprint of your signature for the thief to duplicate. If you know you're going to need a check, just tear one out and carry it with you. If you're going to need multiple checks, go ahead and bring the checkbook but don't get in the habit of always having it on your person.

6. Too Many Credit Cards
Most people carry all their credit cards with them all the time, but if your wallet is stolen not only will you have to take the time to cancel every single card, you'll also be without any cards for about a week. You should only carry the one or two cards you use daily and be sure to keep photocopies of the front and back of the cards at home. On the back of the card is the 1-800 number to report to report the card stolen, which isn't very helpful if you don't have the card.

7. Too Much Cash
You should only bring as much cash with you as you're prepared to lose. It's best to just carry enough to be helpful in the event of an emergency. If you're the type of person who pays for everything in cash, only carry enough for the day's expenses because once your cash is stolen it's gone forever.

8. Gift Certificates/Cards
You may carry these items thinking that you may pass the store your certificate is for, but in truth, gift cards and certificates are just as risky as cash. Once they're stolen, they don't require an ID for use and are gone for good if stolen.

9. USB Devices and Jewelry

"It may sound silly, but if you're changing earrings or heading from a business meeting, it's very possible you may forget and toss these things in the zipper compartment of your wallet," says Lin. USB devices can be bad news in the hands of thieves if they contain confidential files. "It would be horrible to get your wallet stolen any day, but if you're also losing your grandmother's earrings or a presentation you've been working on for months, it's even worse!"

10. Receipts
Receipts, like your checkbook, such as credit card information and your signature, which a thief could learn to forge. If you're hanging onto a receipt for warranty purposes, it's best to leave it at a safe place at home instead of carrying it with you. It's also a good idea to get into the habit of cleaning out your receipts every night and not carrying so many around with you all the time.

Identity theft is a huge problem, but if you use the tips above your risk of being crippled by identity theft are lowered significantly. If you have had problems with identity theft and have questions or concerns, feel free to contact us through our website or by calling 205-879-2447.

You can join our Facebook Fan Page - Alabama Consumer Protection Attorneys where we share useful information about the same types of issues that we cover in this blog.

You can also sign up for our free email newsletter sent out every Thursday morning - we cover topics such as the one in this post. We would love to include you! Just fill out the form below:

Contact Information
First Name *
Last Name *
Email *
Street Address 1
Street Address 2
City *
State *
Zip Code


Posted by Watts & Herring, LLC | | Email This Post

Posted In: Identity Theft

Watts & Herring, LLC
Alabama Consumer Protection Lawyers
Phone: (205) 879-2447

Contact Us

Watts Law Group & M. Stan Herring Blogs

Recent Entries

Legal Blogs