Latest Credit Repair Articles

There has been a lot of criticism over the practice of credit card companies using social media as a resource for recruiting new business. Lenders have been found to roam around on Facebook and Twitter in an effort to find what the younger set is ‘liking’ so they can develop better strategies for gaining new customers.

Experts are concerned about this recent turn of events especially in light of the Credit Card Accountability, Responsibility, and Disclosure Act which was developed to protect consumers of all ages from aggressive lending tactics. When this law went into effect two years ago, it put a stop to the credit card kiosks in malls and on college campuses that were soliciting new business by giving away free swag.

To date, American Express has been found to be the most aggressive social media user for promoting their credit cards. There are deals appearing on the popular social media portals that offer discounts to card holders if they sign up and synch their credit cards to their social media accounts. American Express contends they do not target their media campaigns to those under the age of 21 but have not stopped checking in on Foursquare or Facebook. Read more…

The federal government is now involved in a credit card skimming scheme that affected a number of customers who patronized a Tulsa McDonald’s drive-thru.

One worker has already admitted to using a handheld credit card skimming device over the course of three weeks in order to snag the credit card numbers. The employee then sold the numbers he acquired to Daniel Jefferson. Jefferson and three accomplices then had access to nearly 282 credit card numbers, which were found on the accused’s laptop.

Credit card skimming devices are not an uncommon scam affecting credit card holders. The mechanism is used to capture the important details of the customer’s credit card with a simple swipe and many times consumers have no idea their cards have been skimmed during a normal transaction. The handheld devices make it easy for cons to score countless credit card numbers which are either sold to another party or used by the con artist to access monies through customer credit accounts.

The four men were not only involved in the illegal business of credit card skimming. During the investigation, it was discovered the men also took part in a scam originating in Ghana where gift cards have been reprogrammed with a stolen credit card number that allows endless purchases on an untraceable gift card.

The Secret Service and the FBI are involved in the case due to the nature of the crimes. They warn credit card holders to always check their monthly statements after using their bank card or credit card to take proactive measures against credit card fraud. Many credit card account holders neglect checking monthly statements which allows the con artists plenty of time to overdraw the consumer accounts and making it more difficult for law enforcement to catch the thieves.

Law enforcement also encourages credit card users to always monitor their card activity are report any suspicious charges before their credit reputation is ruined due to someone elses illegal actions. Special agents in the Tulsa case stated that many large-ring credit card scams happen throughout the nation, leaving people to pick up the pieces of massive debts and credit ruination.

Credit card companies are showing more evidence that the economy of the United States is getting stronger. Results of latest studies show more consumers are using their credit cards once again, showing more charges recently than in the last year.

In 2011, American credit card holders charged almost $48 billion in new credit card purchases. This is a huge leap from the charges completed the previous year and 577 percent more than in 2009. Credit card companies were also very aggressive in both 2009 and 2012 in writing off bad debts from defaulted accounts. Consumers are still shown to default on their credit card accounts with a total of $44.2 billion in defaulted debts.

Credit card companies are also more actively promoting credit card accounts in new ways to increase consumer use. Mobile payments and other online business ventures are helping to increase credit card usage, especially over the Internet. Visa is set to release their ‘digital wallet’ product to make online purchases more secure by allowing transactions to be completed without having account numbers typed in for each purchase. Read more…

Impatient people have lower credit scores according to a study released in December 2011. But, new data shows a correlation between rudeness and high credit scores. According to a Huffington Post article, some of the rudest cities in the nation are also homes to consumers with the highest credit scores.

Based on an annual survey from Travel + Leisure magazine, New York, Miami, D.C., Los Angeles, and Boston are the top 5 rudest cities in the nation. And, Huffington Post says, 4 of those 5 cities also have credit scores higher than the national average: D.C. 686, Los Angeles 684, Boston 687, and New York 682.

What do people in these cities have that residents of other cities don’t? Huffington Post suggests their aggressive nature keeps them on top of their accounts and paying on time. HP also points out that cities with diversity may encourage consumers to diversity their financial accounts. The mix of your credit accounts is 10% of your credit score, so having different kinds of accounts, credit card and loans, helps your credit score.

In addition, Travel + Leisure says that big cities are known for being direct. Directness can be interpreted as rude, but it might also help you get negative details removed from your credit report or convince a creditor to lower your interest rate or remove a late penalty. Read more…

American Express Co is the largest credit card provider by purchases and they are now under the microscope for some of their late fee tactics. The Federal Deposit Insurance Corp and the Consumer Financial Protection Bureau are taking action against the company for late fees that were incurred by some AmEx customers through Centurion Bank.

There are no specific details as to how much the charges were for late payments by AmEx customers but the FDIC plans to file formal action against the credit card company. It is expected that the procedures of Centurion will be changed and the bank will be charged penalty fees and be required to provide customer refunds for overcharges found. American Express spokesperson suggested the changes may ‘adversely affect the company’s operations’.

The investigation is an ongoing result of changes in the credit card industry that took effect after the financial crisis came to a head in 2008. The credit card industry was pinpointed by Congress concerning rates and fees being charged to credit card customers. The new Consumer Financial Protection Bureau is also a result of the national crisis and was instituted to better protect consumers that were essentially powerless against rising fees and changing rules.

American Express presently expects legal matters and governmental investigations to cost them anywhere from nothing to a staggering $510 million in fines, penalties, and payouts. Discover Financial Services have also been on the receiving end of these investigations that may end up hurting their bottom line.

The new credit card regulations concerning fees and penalties were enacted in August 2010 which limits how much credit card providers can charge customers that were late paying bills. Previous to the changes, consumers were seeing skyrocketing interest rate charges for minor infractions and struggling with debts that soared after penalties were assessed. Since 2010, the CFBP has been closing monitoring the credit card industry and American Express is just the latest to be investigated for unfair practices despite new regulations.

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Reports show that more than 1.3 million Americans turned to credit unions in the last year for bank services which is quite a jump from the 600,000 who signed up in 2010. This jump is likely due to the much higher bank fees being imposed on customers and those customers that can no longer afford them.

Credit unions have benefited since the major banks began instituting bank fees in order to gain back profits after they were put under tighter restrictions on how much they can charge for different services. As a result, banks had to figure out different avenues for charging customers which including increasing debit card usage fees, ATM fees, and doing away with free checking accounts.

As consumers continue to struggle with unemployment and tighter budgets, many have sought refuge from credit unions. Non-profit credit unions have been more generous with their free and low-cost services and consumers can afford to do their banking once again. Lending has also grown in popularity as more people seek the lower interest rates, less fees, and higher chances of loan approval from local credit unions. Read more…

Debt collectors routinely try to collect on debts that they know would not be enforceable in court. They may even try to get you to restart the debt by making a partial payment or by transferring the old debt to a new credit card. But, in a lawsuit settlement with one of the biggest debt collectors, the FTC lets the debt collection industry know that collecting on expired, or time-barred debts, is not ok.

The FTC sued Asset Acceptance, a company who might be listed on your credit report, following allegations that the company violated several rules including: telling consumers they owed debt that the collector may not have been able to prove, failing to tell consumers that their debts were past the statute of limitations, and failing to tell consumers that a partial payment would extend the statute of limitations.

In addition to a civil penalty of $2.5 million, Asset Acceptance has agreed to inform consumers when their debts are too old to be legally enforceable and to let consumers know that a partial payment would essentially restart the statute of limitations on that account. Asset Acceptance also has to inform consumers when they’ve placed a negative account on the consumer’s credit report.

While a judge hasn’t signed off the terms of the settlement, they set a precedent for what the FTC expects of the collection industry. The agency has also released a new publication, “Time-Barred Debts: Understanding Your Rights When It Comes to Old Debts,” to help consumers better understand what to do about old debts.

You may know that the statute of limitations varies by states. It’s generally between Read more…

A cashier at a Westchester NY has been alleged to have played a part in a consumer credit card scam that netted more than $180,000. The cashier has been accused of selling the card information she stole while working at Staples.

Valerie Fajardo, a 21 year old from the Bronx, utilized a credit card skimming device to steal card data from customers from May to December.

The information she scammed from the customers was then sold to a man for $6,000. The man who bought the stolen credit card information then used it to create fake cards and subsequently used those cards to charge more than $180,000 in purchases. The cashier was finally arrested this week and booked on charges of scheme to defraud and criminal possession of a forgery device. She is still in jail without bail. There was no word on the charges, if any, filed against the man. Read more…

The Federal Reserve released its monthly report for December outlining the use of consumer credit. It appears the percentage of consumers borrowing outside of mortgages has actually gone up for the month. The month of November also showed an increase making the two month span the highest rise in consumer credit borrowing in the past 11 years.

It appears more consumers are feeling confident enough to borrow on credit. The increase is mostly contributed to student loans, vehicle loans, and credit cards. This information may indicate the United States economy is rebounding and consumers are gaining their confidence back.

The data may also be due in part to banks and lenders lessening their strict lending standards. Consumer debt is also said to be falling since 2008 but the amount consumers have borrowed currently sits at $2.5 trillion which is about the same level as it was prior to the recession hitting. Read more…

Personal finance experts have long been warning consumers about investigating credit card fees before signing up for a card. Believe it or not, there are card holders actually willing to fork over $400 a year to have one of First Premier Bank’s cards.

This $400 annual fee card is not designed for the rich and famous. This card is actually promoted to consumers who hold poor credit scores but still want access to credit. In addition to the $400 annual fee, the card carries an astounding 36% interest rate as well as other high fees that go along with the card.

A First Premier Bank representative stated their card fees are based on the risk associated with the consumer applying for the card. In the case of people with poor financial histories, the risk of card payment defaults is significantly higher than with consumers holding excellent scores. The bank representative defends the high rates as a way to protect the company’s bottom line.

Critics say that the higher fees for cards are not doing a thing to help people struggling with bad credit. It can be a vicious cycle of debt and bad credit for consumers that seek out more cards in order to have access to money. Read more…

New credit reporting tactics mean that rent payments may now have an impact on your credit score. So if you haven’t been faithful about making timely payments because they’re not reported to the bureaus, it’s time to change that habit.

In June 2010, Experian purchased RentBureau, a rental reporting agency that collected rental payment information. Months later, Experian began reporting timely rent payments on consumers’ reports. Those payments, in turn, were reflected in consumers’ VantageScore based on Experian report data. This year, Experian plans to begin reporting both negative and positive rental history. That means late payments can hurt you the same way that timely payments can help you.

A newer reporting agency, CoreLogic, is working with FICO, provider of the well-known credit score, to create a report and score that includes rental payment history, according to the New York Times. Timely rent payments can make it easier to rebuild a bad credit score, especially if Read more…

Capital One Financial Corporation launched the new Journey Credit Tracker. It is an online financial education resource for customers with Journey Student Rewards accounts. Capital One’s new venture is powered by CreditKarma and allows cardholders access to their credit score each month from the TransUnion reporting agency.

Capital One instituted the Journey card to teach students the basics of a good credit foundation. It is designed to help student card holders build a strong financial history and understand the importance of making a good financial choices especially as a young adult.

The Journey Credit Tracker will help student cardholders track the financial progress by allowing fast access to their score and ongoing monitoring of that score to see how financial decisions will affect it. Students can utilize the tools to compare their own score to other people of the same age or location. The tool allows users to simulate what would happen to their credit score if they made certain financial sources. In addition to the tracking tools, the Journey card website provides Read more…

There have been a lot of news headlines over the recently released card by Suze Orman, personal finance expert. Many consumers believe using debit cards keeps them out of debt and avoids high interest rates. However, if you are intent on repairing your credit score, using a card is a wiser move to make but you must do it responsibly.

Fraud is one reason consumers should consider when avoiding cards, especially when making online purchases. Debit cards do not protect you like credit cards can. If someone accesses your bank card information, they literally can access all of the cash you have in your account. Since many consumers do not notice until it is too late, this can be detrimental to your overall finances.

Another concern of personal finance experts is the lack of credit rebuilding power associated with a debit card. When you make purchases on a debit card linked to your bank, you are doing nothing to increase your own score. This can be dangerous, especially now when many industries are relying on your score to make decisions. Read more…

Now that the spending holidays have passed, there is a lot of consumer concern about eliminating the debts incurred on cards and starting credit repair initiatives. For consumers that overspent and now face the inability of being able to repay their debts, it is important to explore debt relief options before choosing one, especially for those considering a zero-percent balance card.

Balance transfer credit cards give consumers the option to transfer existing card balances from other cards with the theory that it is easier to pay down one debt, especially at a zero-percent interest rate. However, there are some precautions to take with a zero-percent balance transfer card.

Consumers are being advised to look at every detail of the credit card offer before signing on to transfer balances. What you don’t know about balance transfers could cost you more in the long run. It is advisable to first look at the length of time the 0% rate is being offered and be assured you can repay the balance within that time frame. Many consumers fail to realize the zero-interest offer is only for a promotional period. Once that time frame ends, the interest rate could be much higher than you can reasonably afford.

The other important aspect of balance transfer cards consumers need to understand concerns the fees for card use. Transferring of balances from other cards is not without Read more…

There are several news stories this week pertaining to a consumer’s quest to achieve the best credit score. Currently, lenders have set their standards for good credit scores around 730. Those that hold a score of 730 or higher are assured in getting the best options when it comes to financing a loan, obtaining car insurance, or other financial services.

While it is good news that consumers are taking a more proactive interest in their credit scores, the quest to achieve a score of 800 or more may not be as achievable as one would think. Personal finance experts are now saying that once a consumer has achieved a FICO score of 760, efforts to increase that score any higher may be ‘futile’.

Once a 760 score is achieved, consumers are not likely to find any better interest rates or financial service offers that are better than that. However, some consumers are not to be swayed. They continue their quest to achieve an 800 or better for their credit profile despite the difficulty in increasing scores after they hit 760. Read more…