I am trying to clean up my credit and I called one of my creditor to set up a settlement plan with them to pay the balance that they charged off. The amount that they are asking me to pay was more than double the amount that appears in the credit report. The credit limit was only $350 and I owe them $376 which is the amount in the credit report. But they want me to pay $751.52 which they said are include late penalties and interest of 32.24%. They just charged off the $376 recently in the middle of 2006. What can I do to settle this?

Arturo (more…)

Stump the Experts?  You must forgive me for my liberal use of the word expert.  Still – no matter how you slice and dice it – Dale and I do have a combined fifty-five years of experience in the mortgage biz and that means we’ve looked at a bazillion credit reports.  So if you have any questions about mortgages or credit reports then fire away! 

By the way, it’s so much easier to answer a question from a visitor that clicks on “Stump The Experts” than it is to create a new blog article from scratch.  This year, I’ve developed a whole new appreciation for the authors of blogs out there.  I’m mumbling Broken Credit blog articles in my sleep.  Credit repair mortgage repair credit repairing – excuse me.  See what I mean?

So I dare ya.  I double dare ya!

Click on Stump The Experts….

Credit card companies don’t like me.  Now, don’t get me wrong, I pay my balance by the due date every month, but that’s why they don’t like me.  The credit card industry does not earn hundreds of millions billions yeah, tens of billions of dollars in annual profits from those who pay their balance in full each month.  Their preferred clientele, ‘the sweet spot’, are those who carry a balance and pay only the minimum monthly payment.  Almost with theatrical stereotypes – a villain fronting as a white knight to seduce an innocent maiden, only to reveal his true identity after the relationship has begun.  Stay away! Don’t do it!  The audience yells.  Would I be out of line if I made a parallel between a drug-pusher who offers naïve ones free candy for a time and then when it’s too late and the prey is hooked, the dealer begins to collect his dividends?  That might be a little over-the-top even for me.  After all, it does take two to tango and we are all adults.  Therefore, this article will not be about “just say no”, but rather, how to turn these tables around.  The credit card trickster becomes the credit card trick. (more…)

The GAO completed a 114-page report in September ’06 titled “Increased Complexity in Rates and Fees Heightens Need for More Effective Disclosures to Consumers”.  Kudos to David G. Wood of the GAO for his work on the report – it’s high time the Federal Reserve makes the big bad credit card companies revise their disclosures so the average Joe can understand them.  According to the report, “GAO’s interviews with 112 cardholders indicated that many failed to understand key aspects of their cards, including when they would be charged for late payments or what actions could cause issuers to raise rates”.  The most painful provision buried in the legalese is that of Universal Default.  Earlier this year, the Broken Credit Blog wrote an article titled “What is Universal Default” where we described how credit card companies catapult your interest rate to over 30% based on provisions in the fine print. 

(source=gao.gov/new.items/d06929.pdf)

Did you read the fine print on your credit card disclosure?  It may have contained a sentence or two regarding Universal Default.  Universal Default is a clause that allows a creditor to raise your interest rate to a default rate (in many cases over 30%) even if you have never missed a payment to that creditor.  In other words, you are considered in default with that creditor even though you have never been late. (more…)