College student credit card debt

Credit card debt doesn’t shy away from anyone who doesn’t want to shy away from it. It treats everyone equally irrespective of whether the person is a seasoned professional or just a college student. So college student credit card debt isn’t uncommon either. Since the credit limit on college student credit cards is much lower, the college student credit card debt cannot rise to the levels it does for other credit cards. However, college student credit card debt is an even bigger menace because a lot of students are already in debt due to the loan they have taken for their education. If they pass out of college with college student credit card debt, they will have to payback not just the loan they taken for studies but also their college student credit card debt.

Since most of the college students are inexperienced in the usage of credit cards, they can easily fall prey to what we call as ‘college student credit card debt’. In fact, college student credit card debt is one reason why the credit card suppliers keep a lower credit limit on college student credit cards. The solution for avoiding college student credit card debt is similar to what it is for avoidance of any type of credit card debt. So, the first thing for avoiding college student credit card debt is to understand the concept that credit card is not free money and that whatever you pay-for using your credit card has to be paid back to the credit card supplier when your credit card bill arrives. So don’t treat credit card separate from hard cash. Avoid overspending e.g. do not buy things just because they are on sale, sales keep coming and going and there are always better offers each time; buy only those things that you really need. A good thing to do is to prepare your monthly budget and follow it religiously. Never budge from your budget. Another very important preventive measure for avoiding college student credit card debt is to avoid going for a second credit card. Some students have a tendency to go for multiple credit cards just because the credit limit on college student credit cards is very low. However, this is a perfect recipe for getting into a college student credit card debt. This is how college student credit card debt builds up. One credit card is more than enough for any student.

College student credit card is really meant to be treated like a training ground for learning more about credit cards. It should not be make an instrument of debt (college student credit card debt).

Credit card debt elimination - Taking a step towards credit card debt elimination

Taking a step towards credit card debt elimination

So you have decided to go for credit card debt elimination and are wondering on what the methods for credit card debt elimination are. As they say, let’s take the bull by its horns and lay it all flat on the ground. There are generally 2 recommendations that are most common for credit card debt elimination: controlling the expenditures and consolidating debt. Let’s check both of these credit card debt elimination recommendations and check the list of things that you can do for achieving credit card debt elimination using these recommendations:

1. Control your urge to spend: The first thing to do for credit card debt elimination is to control your expenditures. Here we are talking about the payments you make using your credit card. Remember that the main reason being your getting into credit card debt is uncontrolled expenditures using your credit card. So if you are really serious about credit card debt elimination, this is one thing that will help in credit card debt elimination by preventing accumulation of further debt. Here is what you can do to control your expenditures:
a. You need to stay away from attractive offers that are put-up by various shops and stores. Don’t buy anything that you don’t really-really need. After all you are looking for credit card debt elimination not supplementation.
b. Leave your credit card at home. If you really-really need something, then you can fetch your credit card from your house. This will prevent you from yielding to the too-attractive-to-resist sale offers (that are actually there all the year round). This credit card debt elimination technique, again, works on the principal of ‘prevention is better than cure’. This will prevent unplanned expenses from happening.
c. Prepare a monthly budget and stick to it. This is really a very important credit card debt elimination measure. This budget will form the basis of your credit card debt elimination plan. So if you deviate from your budget, your credit card debt elimination plan will go for a toss.

2. Debt consolidation: Debt consolidation or moving from high APR credit cards to a low APR one is generally the first step (the first reactive step) for credit card debt elimination. Here are a few things that you need to do:
a. Do not go for the first balance offer you come across. Analyse various offers and choose the one that best suits you. This will be an important thing on you credit card debt elimination plan. Initial APR, Initial APR period and standard Apr, all need to be considered.
b. Read the fine print on the balance transfer offer and check the terms and conditions on these. These might affect your overall credit card debt elimination plan.
c. Compare other benefits e.g. rebates, reward points, etc, before you actually decide to go for one of the offers.

Credit card debt elimination is about proper planning and discipline. So make your credit card debt elimination plan and stick to it.

After you pay off credit card debt

Credit card debt is a very big problem that is being faced by a lot of people who have been irresponsible and undisciplined in the use of their credit card. Though some might have landed up with credit card debt due to some unfortunate event/emergency in their life, most people carry a credit card debt due to their own wrong doings (i.e. wrong usage of their credit card debt). There are a lot of ways to pay off credit card debt and a lot of people do achieve this feat (i.e. are able to pay off credit card debt). Surely, to be able to pay off credit card debt is really a great achievement in itself for not everyone is able to pay off credit card debt. It takes a lot of discipline, restraint, planning and perseverance to finally pay off credit card debt. However, there is more to paying off credit card debt then just being able to pay off credit card debt.

Here we are talking about the life after you pay off credit card debt successfully. As mentioned before, of all the people that try to pay off credit card debt not everyone is able to pay off credit card debt i.e. there are some failures too. However, some people fail after they have succeeded in paying off credit card debt. These are those people who let themselves loose and go on a spending spree as soon as they pay off credit card debt. Soon, these people again land up with a credit card debt and are again trying to pay off credit card debt. So, it’s not enough to just pay off credit card debt, it’s equally important to maintain a debt-free status even after you pay off credit card debt; only then can you enjoy a stress-free life in the world of credit cards. So learn your lessons well and do not let yourself loose on the path to another credit card debt. Most of the rules that you followed when you were trying to pay off credit card debt, will also hold good after you have paid off your credit card debt. Here is a quick synopsis of things that you should take care of even after you pay off credit card debt:
1) Do not overspend. Yielding to the sale offers for something that you don’t really need, is a big mistake that leads to overspending
2) Always remain within 70% of your credit limit.
3) Make credit card bill payments in time and in full.
4) Don’t hold more than 2 credit card accounts (two are enough for anyone)

These are just very basic things; you can add more based on your own experience and knowledge.

Beware of Credit Repair Scams

Having poor credit can be an incredibly painful and frustrating
experience. It is harder to get a loan, creditors may be hounding you and
you
may be unable to pay your bills on time, which feeds the cycle. The
subsequent feelings of desperation may leave you vulnerable to
unscrupulous individuals or companies who promise to be able to quickly
or
instantly fix your credit. Understanding that it will likely take you years
to
fix your credit on your own, it is very tempting to give in and give
these companies a try. These scammers feed off of your desperation and
use it to trap you. But you don't have to be duped. Below, we will be
discussing some of the common credit repair warning signs.

1. Payment Required Before Your Credit is Fixed: Many times these
companies will promise to fix your credit and require that you pay them an
upfront fee. Well, you pay them the fee and you never hear from them
again. You won't know that you have been duped until either, they no
longer take your calls, their number is disconnected or your credit score
never changes.

2. A Company Doesn't Want You to Contact A Credit Reporting Agency
Yourself: A company that doesn't want you to directly contact a credit
reporting agency on your own may have something to hide. Avoid these
companies.

3. Companies Who Suggest That You Create a New Identity: Some
companies
or internet guides may suggest that you create a new
identity and open
up a new credit file. This is illegal and you could face
prosecution.
Avoid this tactic like the plague.

4. Companies That Promise To Fix Your Credit In a Matter of Days: There
are no legal ways to fix your credit in a few days without doing
something illegal. Completely ignore these companies. Repairing your credit
will take time and discipline. There are no quick fixes. So don't
trust any company that promises you one.

5. Companies That Ask You to Lie: Some credit repair scammers will
advise you to refute everything on your credit report even if it is true.
The rational behind this "trick" is this. Credit agencies are big
and busy. This makes it difficult for them to check your claims of
refuting charges. Credit reporting companies only have so many days to
reply
to your claim. If they don't reply within the given time frame, the
items in question must be taken off of your credit report. So you refute
everything and hope that they are too busy to reply to you in a timely
manner. This is something that you should never do. It is illegal and
you can be charged with fraud and could face prosecution if you are
found to be knowingly lying.

Repairing your credit will require discipline, time and commitment.
There are no shortcuts. Any company that promises you that there are
should be avoided. Most of the things these companies promise to do for
you, excluding the illegal, you can and should do for yourself. Therefore,
in most cases a credit repair agency is absolutely unnecessary.

7 Important Credit Repair Tips

Having a poor credit score has big effect on many aspects on one's
life, specifically the financial part of it. Poor credit will effect the
terms that one receives on loans. It
might also even effect whether one lands a job or not. More and more
employers are checking potential employee's credit before extending a
job offer. This may all sound pretty grim if you have poor credit.
However, it is important to note that poor credit does not have to follow
you throughout your entire life. In fact, if you commit to taking certain
measures, you can see a vast improvement of your credit score in as
little as a year. In this article, we will be providing some effective
tips to help you clean up your credit.

1. Take An Honest Inventory: In order to improve your credit, the first
thing you need to do is be honest and take an inventory of your
situation. What credit cards and debt do you really have? Use a spreadsheet
and write it all down. This will help formulate a realistic and
effective plan to get rid of your debt.


2. Use a Pre-paid Debit Card: Pre-paid debit cards are a good way to
make sure that you don't spend more than you have available. This also
means no late-fees or charges from your bank if you bounce a check.
These types of cards also help to develop some discipline. If you don't
have it, you can't spend it, so you will have to become more
responsible in your spending. Not having late fees reported on your credit
report, will also help your rating.

3. Negotiate With Your Creditors: Try to negotiate with your creditors
and see if they would be willing to lower your interest rates or wave
any fees. Many creditors will rather work with you, then to have you
default on a loan.


4. Get A Credit Counselor: If you aren't able to negotiate rate
reductions with your creditors, a credit counseling agency will. They will
also be able to set you up on a fee paying schedule so that you can pay
all your credit cards at once. They will create a payment schedule for
you and you will know exactly when you should be getting out of debt.
And while credit counseling will appear on your credit report, at least
potential lenders will see that you are making an attempt to get your
financial affairs in order. Also, getting out of debt will improve your
credit rating much more then credit counseling will hurt it.


5. Consolidate: Consolidating your debt can be a good way roll your
debt into one loan and make one payment.


6. Get Serious and Commit: If you want to be able to get out of debt,
it will require laser focus and commitment. You have to get serious and
really want to better your financial situation. Repairing your credit
isn't something that you can do half-heartedly.


7. Don't Get Discouraged: The process of repairing your credit will
be filled with some highs and some lows. Don't get discouraged. Keep
forging ahead and being disciplined and you will see results.

Repairing your credit will be a difficult process. It will require that
you to discipline your spending, save and find a way to pay back what
you owe. However, if you buckle down and commit to tackling the problem
you will find that the relief that you experience when you repair your
credit, will be worth any hardship you go through to repair it.

How to Improve your Credit

  • Make sure all the information in your report is accurate.
  • Dispute inaccurate items in your report. (Note our credit report service includes toll-free customer service if you have questions about filing a dispute.)
  • Pay off any collections or past due amounts.
  • Pay down loan balances if you are able.
  • Try to have a period of 12 to 24 months with no late payments, past dues or other derogatory items.
  • Try to minimize the number of inquiries into your credit report from credit grantors, by not applying for credit unless absolutely necessary.

HOW TO OBTAIN YOUR CREDIT REPORT


If you have been denied credit, insurance, or employment because of
information that was supplied by a credit reporting agency, the Fair
Credit Reporting Act requires the report recipient to give you the name
and address of the credit reporting agency that supplied the information.
If you contact that agency to learn what is in your file within 30 days of
receiving the denial notice, your report is free.

If you simply want a copy of your report, call the credit reporting
agencies listed in the Yellow Pages under "credit' or "credit rating and
reporting." Call each reporting agency listed since more than one agency
may have a file on you, some with different information. You may have to
pay a reasonable charge for each report.

Disputing Your Negative Credit Report Entries

If Changes Aren't Made

If the credit reporting agency says the original information is accurate, it must provide you with a written notice that includes the name, address, and phone number of the person who made the report. If you still disagree, initiate a second investigation.

Unfortunately, in the real world the reporting agencies often try to sidestep that requirement, giving you standard, computer-generated information rather than the facts you need to find the person or department who made the negative report. Keep plugging away until you have the answer you're looking for.

If your attempts to correct an entry are unsuccessful, you can ask the reporting agency to insert a 100-character explanation next to it that explains your side of the story.

Sometimes You Hit a Dead End

I know from personal experience that it's sometimes difficult to have information changed, even if you can prove it is incorrect. A family member has not been able to have an incorrect employer notation corrected, even though he has not worked at the company for many years. The standard response from the credit reporting agency is that they would not have the information if he had not included it on an application for credit.

They refuse to remove the incorrect notation, even though he has provided them with a letter from his current employer and several W2s.

Why did that happen? Somoneone likely keyed-in a previous employer as a current employer. Sometimes you simply cannot get through to them that errors exist.

How to Dispute Credit Report Errors

Your credit report contains information about where you live, how you pay your bills, and whether you’ve been sued, arrested, or filed for bankruptcy. Consumer reporting companies sell the information in your report to creditors, insurers, employers, and other businesses that use it to evaluate your applications for credit, insurance, employment, or renting a home. The federal Fair Credit Reporting Act (FCRA) promotes the accuracy and privacy of information in the files of the nation’s consumer reporting companies.

Some financial advisors and consumer advocates suggest that you review your credit report periodically. Why?
  • Because the information it contains affects whether you can get a loan—and how much you will have to pay to borrow money.
  • To make sure the information is accurate, complete, and up-to-date before you apply for a loan for a major purchase like a house or car, buy insurance, or apply for a job.
  • To help guard against identity theft. That’s when someone uses your personal information—like your name, your Social Security number, or your credit card number—to commit fraud. Identity thieves may use your information to open a new credit card account in your name. Then, when they don’t pay the bills, the delinquent account is reported on your credit report. Inaccurate information like that could affect your ability to get credit, insurance, or even a job.

Getting Your Credit Report

An amendment to the FCRA requires each of the nationwide consumer reporting companies—Equifax, Experian, and TransUnion—to provide you with a free copy of your credit report, at your request, once every 12 months.

For details, see Your Access to Free Credit Reports at ftc.gov/bcp/conline/edcams/credit/.

How to Order Your Free Report

The three nationwide consumer reporting companies have set up one website, toll-free telephone number, and mailing address through which you can order your free annual report. To order, visit www.annualcreditreport.com, call 877-322-8228, or complete the Annual Credit Report Request Form and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. You can use the form in this brochure, or you can print it from ftc.gov/bcp/conline/edcams/credit/. Do not contact the three nationwide consumer reporting companies individually. They are providing free annual credit reports only through www.annualcreditreport.com, 877-322-8228, and Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.

You may order your reports from each of the three nationwide consumer reporting companies at the same time, or you can order from only one or two. The law allows you to order one free copy from each of the nationwide consumer reporting companies every 12 months.

You need to provide your name, address, Social Security number, and date of birth. If you have moved in the last two years, you may have to provide your previous address. To maintain the security of your file, each nationwide consumer reporting company may ask you for some information that only you would know, like the amount of your monthly mortgage payment. Each company may ask you for different information because the information each has in your file may come from different sources.

Other situations where you might be eligible for a free report

Under federal law, you’re also entitled to a free report if a company takes adverse action against you, such as denying your application for credit, insurance, or employment, based on information in your report. You must ask for your report within 60 days of receiving notice of the action. The notice will give you the name, address, and phone number of the consumer reporting company.

You’re also entitled to one free report a year if you’re unemployed and plan to look for a job within 60 days; if you’re on welfare; or if your report is inaccurate because of fraud, including identity theft.

Otherwise, a consumer reporting company may charge you up to $9.50 for another copy of your report within a 12-month period. To buy a copy of your report, contact:


Equifax-800-685-1111
www.equifax.com

Experian-888-EXPERIAN (888-397-3742)
www.experian.com

TransUnion-800-916-8800
www.transunion.com

Under state law, consumers in Colorado, Georgia, Maine, Maryland, Massachusetts, New Jersey, and Vermont already have free access to their credit reports.

For details, see Your Access to Free Credit Reports at ftc.gov/bcp/conline/edcams/credit/.

Correcting Errors

Under the FCRA, both the consumer reporting company and the information provider (that is, the person, company, or organization that provides information about you to a consumer reporting company) are responsible for correcting inaccurate or incomplete information in your report. To take advantage of all your rights under this law, contact the consumer reporting company and the information provider.

Step One

Tell the consumer reporting company, in writing, what information you think is inaccurate. Include copies (NOT originals) of documents that support your position. In addition to providing your complete name and address, your letter should clearly identify each item in your report you dispute, state the facts and explain why you dispute the information, and request that it be removed or corrected. You may want to enclose a copy of your report with the items in question circled. Your letter may look something like the one on page 4. Send your letter by certified mail, “return receipt requested,” so you can document what the consumer reporting company received. Keep copies of your dispute letter and enclosures.

Consumer reporting companies must investigate the items in question—usually within 30 days—unless they consider your dispute frivolous. They also must forward all the relevant data you provide about the inaccuracy to the organization that provided the information. After the information provider receives notice of a dispute from the consumer reporting company, it must investigate, review the relevant information, and report the results back to the consumer reporting company. If the information provider finds the disputed information is inaccurate, it must notify all three nationwide consumer reporting companies so they can correct the information in your file.

When the investigation is complete, the consumer reporting company must give you the results in writing and a free copy of your report if the dispute results in a change. This free report does not count as your annual free report. If an item is changed or deleted, the consumer reporting company cannot put the disputed information back in your file unless the information provider verifies that it is accurate and complete. The consumer reporting company also must send you written notice that includes the name, address, and phone number of the information provider.

If you ask, the consumer reporting company must send notices of any corrections to anyone who received your report in the past six months. You can have a corrected copy of your report sent to anyone who received a copy during the past two years for employment purposes.

If an investigation doesn’t resolve your dispute with the consumer reporting company, you can ask that a statement of the dispute be included in your file and in future reports. You also can ask the consumer reporting company to provide your statement to anyone who received a copy of your report in the recent past. You can expect to pay a fee for this service.

Step Two

Tell the creditor or other information provider, in writing, that you dispute an item. Be sure to include copies (NOT originals) of documents that support your position. Many providers specify an address for disputes. If the provider reports the item to a consumer reporting company, it must include a notice of your dispute. And if you are correct—that is, if the information is found to be inaccurate—the information provider may not report it again.

Adding Accounts to Your File

Your credit file may not reflect all your credit accounts. Although most national department store and all-purpose bank credit card accounts will be included in your file, not all creditors supply information to consumer reporting companies: some travel, entertainment, gasoline card companies, local retailers, and credit unions are among the creditors that don’t.

If you’ve been told that you were denied credit because of an “insufficient credit file” or “no credit file” and you have accounts with creditors that don’t appear in your credit file, ask the consumer reporting companies to add this information to future reports. Although they are not required to do so, many consumer reporting companies will add verifiable accounts for a fee. However, understand that if these creditors do not report to the consumer reporting company on a regular basis, the added items will not be updated in your file.

When negative information in your report is accurate, only the passage of time can assure its removal. A consumer reporting company can report most accurate negative information for seven years and bankruptcy information for 10 years. Information about an unpaid judgment against you can be reported for seven years or until the statute of limitations runs out, whichever is longer. There is no time limit on reporting: information about criminal convictions; information reported in response to your application for a job that pays more than $75,000 a year; and information reported because you’ve applied for more than $150,000 worth of credit or life insurance. There is a standard method for calculating the seven-year reporting period. Generally, the period runs from the date that the event took place.

For more information, see Building a Better Credit Report at ftc.gov/bcp/conline/edcams/credit/.

Sample Dispute Letter

Date
Your Name
Your Address, City, State, Zip Code
Complaint Department

Name of Company
Address
City, State, Zip Code

Dear Sir or Madam:

I am writing to dispute the following information in my file. I have circled the items I dispute on the attached copy of the report I received.

This item (identify item(s) disputed by name of source, such as creditors or tax court, and identify type of item, such as credit account, judgment, etc.) is (inaccurate or incomplete) because (describe what is inaccurate or incomplete and why). I am requesting that the item be removed (or request another specific change) to correct the information.

Enclosed are copies of (use this sentence if applicable and describe any enclosed documentation, such as payment records, court documents) supporting my position. Please reinvestigate this (these) matter(s) and (delete or correct) the disputed item(s) as soon as possible.

Sincerely,
Your name

Enclosures: (List what you are enclosing.)


Visit ftc.gov for more information on disputing credit report errors