Mystar credit and debt help blog

Debt Management -- Debt Consolidation FAQ

FAQ Debt Management- Debt Consolidation: Frequently Asked Questions What does speaking with a Certified Credit Counselor typically involve? The Certified Credit Counselor will discuss your financial situation with you in a courteous and professional manner .You should not be asked for personal information like Bank Account #, Credit Card Account #’s , SS# .Your conversation will be kept strictly confidential with no obligation.  The Counselor will help you develop a workable budget tailored to your needs and financial situation. Possible solutions to your current debt management issues will be reviewed. You will learn about different types of debt and the best way for you to pay down your debts. If appropriate, the Counselor will discuss our Debt Consolidation- Debt Management Program with you to find out if A Debt Management plan will work for you. All disclosures and plan will be provided to you in writing for you to review prior to making a decision .If you speak to a representative who does not follow the above you should end the conversation and call Mystar Financial Solutions Inc.  317-284-6500 , Toll Free 1-877-284-6545 . What is the Debt Consolidation/Debt Management Program? Debt Consolidation through a Debt Management Program enables you to get help from  your creditors in significantly lowering or eliminating your interest rates, stop late fees/or over limit fees on Credit Cards. Lower interest rates translate into more of your monthly payment going towards your principal balance instead of finance charges.  This means that you will be out of debt much more quickly. The Mystar Program consolidates your bills into one convenient monthly payment, which is disbursed to all of your creditors on the program. Debt Consolidation is an alternative to bankruptcy.  In almost every single case, enrolling in our DMP will end harassing phone calls from creditors and collection agencies, usually within the first three months.   In addition to the lowered interest rates and the convenience of one monthly payment, you will also receive support from our Client Care Dept. as you move along on your journey to financial freedom. Is Debt Consolidation a Loan? No. Debt Consolidation is not a loan; it is a debt repayment program, which is better than a loan.  Why borrow more money at high interest ? Your current debt to income ratio may make it difficult to get a loan at a reasonable interest rate or you may not get one at all. A Debt Management plan with Mystar makes more sense since we can help you lower the interest rates on your current debts and get you debt free faster than you thought possible.  Note: You do not need to own a home or have good credit  in order to enroll. Will the Mystar Debt Management Program affect my Credit Rating? Mystar Financial Solutions does not report information to any of the Credit Bureaus. If you are current with all of your bills and you have a satisfactory credit score, your rating should remain virtually unchanged.  As long as you make your monthly payments to the Program on time, your payments to your creditors are considered to be on time as well.  If your credit rating has been poor, once you join the Program, make timely monthly payments and reduce your debt more quickly, your credit worthiness can soon improve.  Please refer to the website www.myfico.com  for further information about how Credit Counseling programs are not considered when credit scores are calculated. Can My Credit Rating Be Repaired by Enrolling in the Debt Consolidation Program? No. No one can remove or wipe out your previous credit history. But by staying on a Mystar Program, you effectively restructure your debt. Your credit rating may actually improve because you will be establishing a positive payment history. Your balances on your debts will decrease and this will demonstrate that you are closer to achieving financial stability. Mystar Financial Solutions is not a Credit Repair Company and does not do Debt Settlements. What kinds of debt can I consolidate? Most forms of unsecured debt can be included in our Program. What is unsecured debt? Unsecured debt is money owed that has no property or collateral attached to it. Examples include credit card debt, department store card debt, medical bills, personal loans, student loans. When on a Mystar Program it is best to refrain from applying for more unsecured debt , especially Credit Cards. Credit Cards listed on your program will not be available for use by you . Getting more debt is not a way of getting out of debt. Secured debt is money owed that does have collateral attached to it which protects the lender in case of default.  Examples of secured debt include mortgages and car loans. How do I qualify for the Program? Any Consumer who is having difficulty paying their bills on time, juggling bills, struggling to make the minimum payments due, charging routine living expenses on credit cards, or someone who is able to pay their bills on time but feel the need to get out of debt faster .You do not have to be a Home-owner.  You do not have to be delinquent with your payments. How do I know if a Debt Management Plan is what I need ? Ask yourself the following questions,  if you answer Yes to any of them then a Debt Management Plan is definitely an option – ·     Are you struggling to meet your minimum payments ? ·     Does it seem that Balances are not going down ? ·     Are your Interest Rates and Minimum Payments being raised by your creditors? ·     Do you have good income , pay on time, but need to get out of debt faster? ·     Are you getting charged Late / Overlimit Fees and High Interest? ·     Are Creditors Harassing you? ·    Call 317-284-6500 , Toll Free 1-877-284-6545 Once I enroll in the Debt Management Program, will creditors still call me looking for payment? Within three months of making three consecutive, on-time payments on our Program, most accounts will “re-age” and will be brought current.  This puts an end to those stressful phone calls.  In the meantime, if your creditors should call you, you should simply state that you are enrolled in our Program, and direct the caller to Mystar’s Client Care Department. Will I continue to receive statements from my creditors while I am on A Mystar Debt Management Program? Yes .You will also receive a statement from Mystar showing the payments made to your creditors .This allows you to verify that payments are being made and watch your balances going down each month Why are the creditors willing to lower my interest rates? Creditors know that when a Consumer enrolls in a debt consolidation program, they could also be considering bankruptcy.  Simply put, creditors want to be paid, and so they would rather lower your interest rates to enable you to pay them. They may also feel confident knowing that you are receiving help on all your debts, especially credit cards,  at Mystar. How is the Debt Consolidation Debt Management Program different than bankruptcy? When you declare bankruptcy, you Do Not pay your bills and your credit rating gets ruined.  In contrast, with the debt consolidation Debt Management Program, you DO pay your debts and with discipline and commitment thereby safeguarding you and your family’s financial future. How do you calculate my monthly payment? Different creditors have different minimum payment requirements for acceptance onto a debt management program. The payment is calculated based on your individual combination of creditors and each of your balances. Initially, your Certified Credit Counselor will not require your account numbers, but the names of your specific Creditors and Balances are required. Also you need to have an income to support a Debt Management Program. Will I be able to send in more money than the minimum payment if I want to? Definitely.  You are always free to make higher payments than the minimum amounts required, and there is never a penalty for early repayment.  In fact, we encourage you to do so whenever it is financially possible.  The higher payments will help you get out of debt faster, and that is our shared goal for you. What kind of educational information do you provide? At Mystar Financial Solutions, our mission is to provide education and counseling in order to assist  consumers to become debt-free while maintaining a stress free lifestyle. We provide FREE Counseling and Education to consumers, whether or not they enroll in the Debt Management Program.  Counseling is done by ongoing in-person meetings when possible, and/or ongoing telephone conversations, seminars, budget planning, written educational packets, website information, At Mystar Credit Counseling , our mission is to provide education ,counseling and on time payments to creditors in order to assist  consumers to become debt-free with care , compassion and commitment . How can I find out more? If you want to find out how much money you can save every month and learn new ways to manage your debt, Call 317-284-6500 , Toll Free 1-877-284-6545 click here for a Free Information Request Form. If you have other questions that have not been addressed in this Debt FAQ, please call or E-mail  info@mystarhelp.com.  One of our Certified Credit Counselors will be happy to answer your questions and put you on the right path towards financial freedom.    Mystar Financial Solutions Inc. - A Better Business Bureau Accredited Business

8 major benefits of new credit card law

By Leslie McFadden - Bankrate.com

On May 22, President Barack Obama signed the Credit Card Accountability, Responsibility and Disclosure, or Credit CARD, Act of 2009 into law. The legislativion will improve consumer disclosures and end some egregious practices in the credit card industry but stops short of capping interest rates and fees. Most of the provisions go into effect Feb. 22, 2010, unless otherwise stated.

Here's an overview of the major changes the law will enact.

1.Retroactive rate increases

Issuers can't raise rate on an existing balance unless a promotional rate expired, the variable indexed rate increased or you paid late by 60 days or more. No longer will they be able to punish borrowers for late payments on unrelated accounts under the practice of universal default or due to "anytime, any reason" clauses.

If the cardholder does tirgger the default rate because of a 60 day delinquency, the bank must restore the lower rate once the cardholder demonstrates six months of consecutive on-time payments. This provision takes effect in August 2009.

In general, rates can't be raised in the first year after issuance, and promotional rates must last at least six months. exceptions include expiration of a promotional rate, termination or completion of a workout plan, a change in the index rate or a 60 day delinquency.

Caveat: Issuers can raise rates at any time for any reason on new balances with 45 days' advance notice. Cardholders will still need to read correspondence from their creditors.

2. More advance notice of rate hikes

Consumers get 45 days' notice before key contract changes take effect, including rate increase. Under the current Truth in Lending Act, cardholders only receive a 15 day heads up. This change takes effect Aug. 20, 2009.

Caveat: This provision doesn't apply to credit limit changes. If your issuer slashes your limit, notification isn't necessary unless the reduction would trigger a penalty, such as an overlimit fee.

The new rules also don't cap interest rates. The increase rate can still be triple your existing APR.

3. Fee restrictions

Cardholders will not face overlimit fees unless they elect to allow the creditor to approve overlimit transactions. Issuers can't charge more than one overlimit fee per billing cycle.

In general, banks can't charge consumers a fee to pay their credit card debt, a cost some cardholders encounter for payments made by telephone or internet. They can impose a fee to expedite a payment.

Payments recieved by the due date - or the next business day, if the bank doesn't accept mailed payments on the due date - won't trigger a late fee. If the cardholder pays at a local branch, the payment must be credited the same day.

The new law limits fees on "fee-harvested" subprime cards as well. In the first year after issuance, nonpenalty fees cannot take up more than 25 percent of the initial credit limit.

4. Restricts card issuance to students

Consumers under age 21 who can't prove an independent means to income or provide the signature or a co-signer aged 21 or older won't get approved for credit cards. The provision protects young people who lack the means or the knowledge to handle credit card from miring themselves into debt, but could backfire by pushing students to payday lenders and pawnshops, says Greg McBride, senior financial analyst at Bankrate.com.

According to a recent Sallie Mae study, college students carried an average balance on $3,173 on their credit cards last year, a record high since the first analysis in 1998. A whopping 82 percent revolved a balance each month.

5. Ends double-cycle billing

The new law bans double-cycle billing, the practice of basing finace charges on the current and previous balance. Under this method, the issuer could charge interest on debt already paid off the previous month.

6. Fairer payment allocation

A close look at your card agreement will likely reveal a clause that explains the payments will be applied to lower-rate balances first. Not so anymore. The Credit CARD Act requres above-the-minimum payments to be applied first to the credit card balance with the highest interest rate.

7. More time to pay

Card companies must send statements 21 days before a payment is due. Current law requires a mere 14 days' notice. This provision goes into effect Aug. 20, 2009.

8. Gift card protections

The legislation includes protections for gift cardholders. The new law prohibits gift cards from expiring for at least five years. Issuer cannot assess inavtivity fees unless the card has gone unused for 12 months.

Location of article: http://www.bankrate.com/finance/credit-cards/8-major-benefits-of-new-credit-card-law-1.aspx

For More Information regarding Credit Card Law and Credit Counseling. Visit www.mystarhelp.com or call

317-284-6500.

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Visit www.mystarhelp.com or call 317-284-6500 for more information about debt management.

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In Debt? Mystar Credit Counseling Can Help!

Mystar Financial Solutions, Inc. provides assistance to families and individuals who are overwhelmed by their indebtedness. At Mystar, we can assist with most debts, not just Credit Cards. Our trained and experienced counselors will review your obligations and income and provide a Debt Management plan to fit your needs. We will provide a FREE, no obligation consultation in our office, via the internet or by phone. At your convenience.

A repayment plan with Mystar can get you out of debt faster than often imagined. We will negotiate with your creditors to reduce or eliminate interest charges and stop or waive late and over limit fees in most cases. Medical Bills, Personal Lines of credit, Collection, Mortgages and Auto Loans can also be handled in your plan. The benefits on these types of debts vary by creditor. Nonetheless, Mystar will help in every way possible to give you the opportunity to achieve financial freedom.

Our focus is to reduce your stress and daily hassles of dealing with multiple creditors. By joining our program, you will work with us and we will handle the rest. You will make one budgeted monthly payment to us to cover the debts on your Debt Management plan, and we will systematically distribute the agreed upon amounts to your creditors. We will provide you with a monthly statement which you can compare to your statements from your creditors, thereby, monitoring your progress. As finances become available, you will have the option of making larger payments towards your debts to aid in the speedy repayment process. Our primary goal is to help you attain Financial Freedom.

Mystar Financial Solutions provides credit counseling, debt management, debt consolidation in Indianapolis, Indiana.

Mystar Financial Solutions, Inc. is Licensed be the State of Indiana - Department of Financial Institutions and Bonded.

Mystar Financial Solutions, Inc. / 7271 N. Shadeland Ave. Indianapolis, IN 46250 / 317-284-6500 or toll free 1-877-284-6545 / Visit www.mystarhelp.com

   

How can Mystar credit counseling help!

Mystar credit counseling will provide you with a custom debt management plan that is right for your special needs. Some benefits of working with Mystar credit counseling are:

• The funds that are paid to Mystar will be paid to your creditors in your behalf. We would make sure that your bills are being paid on time, and your credit card accounts will be monitored to assure that all accounts are correct and up todate.
• At Mystar you would not have to worry about making multiple payments to different creditors, Mystar will consolidate your debts and distribute your funds to your creditors.
• With a Mystar debt management plan, you may receive other benefits from your creditors. Some benefits are lower interest rates, waived late fees, waived over-limit fees, being debt free in most cases to fewer than 5 years or less.

If you feel that a debt management plan with Mystar can help you. Please give us a call today! 317-284-6500 or visit Mystar Credit Counseling online at www.mystarhelp.com.

Getting help with your debts with a debt managment plan (DMP)

Mystar Financial Solutions, Inc.

A Debt Management & Credit Counseling Company

(317) 284-6500

The Federal Trade Commission offers the following advice regarding credit and debt counseling, management and consolidation:

If you or someone you know is in financial hot water, consider these options: realistic budgeting, credit counseling from a reputable organization, debt consolidation, or bankruptcy. Debt negotiation is yet another option. How do you know which will work best for you? It depends on your level of debt, your level of discipline, and your prospects for the future.

Credit Counseling & Debt Management Plans

Credit Counseling: if you're not disciplined enough to create a workable budget and stick to it, can't work out a repayment plan with your creditors, or can't keep track of mounting bills, consider contacting a credit counseling organization. Many credit counseling organizations are nonprofit and will work with you to solve your financial problems. But be aware that, just becasue an organization says it's "nonprofit", there's not guarantee that its services are free, affordable, or even legitimate. In fact, some credit counseling organizations charge high fees, which may be hidden, or urge consumers to make "voluntary" contributions that can cause more debt.

Most credit counselors offer services through local offices, the internet, or on the telephone. If possible, find an organization that offers in-person conunseling. Many universities, military bases, credit unions, housing authorities, and branches of the U.S. Cooperative Extension Service operates nonprofit credit counseling programs. Your financial institution, local consumer protection agency, and friends & family also may be good sources of information and referrals.

Reputable credit counseling organizations can advise you on managing your money and debts, help you develop a budget, and offer free educational materials and workshops. Their Counselors are certified and trained in the areas of consumer credit, money, debt management and budgeting. Counselors discuss your entire financial situation with you, and help you develp a personalized plan to solve your money problems. An initial counseling session typically lasts an hour, with an offer of follow up sessions.

Debt Management Plans

If your financial problems stem from too much debt or your inablility to repay your debts, a credit counseling agency may recommend that you enroll in a debt managment plan(DMP). A DMP alone is not a credit counseling and a DMP is not for everyone. You should sign up for one of these plans only after a certified credit counselor has spent time thoroughly reviewing your financial situation and has offered you customized advice on managing your money. Even if a DMP is appropriate for you, a reputable credit counseling organization still can help you create a budget and teach you money management skills.

In a DMP, you deposit money each month with the credit cousseling organization, which uses your deposits to pay your unsecured debts, like your credit card bills, student loans, and medical bills, according to a payment schedule the counselor develops a with you and your creditors. Your creditors may agree to lower your interest rates or waive certain fees, but check with all your creditors to be sure they offer the concessions that a credit counseling organization describes to you. A successful DMP requires you to make regular timely payments and could take 48 months or more to complete. Ask the credit counselor to estimate how long it will take for you to complete the plan. You may have to agree not to apply for - or use- any additional credit while you're participating in the plan.

Debt Consoliation

You may be able to lower your cost of credit by consolidating your debt through a second mortgage or home equity line of credit. Remember that these loans require you to put up your home as collateral. If you can't make the payments - or if your payments are late - you could lose your home.

What's more, the costs of consolidation loans can add up. In addition to interest on the loans, you may have to pay "points", with one point equal to one percent of the amount you borrow. Still, these loans may provide certain tax advantages that are not available with other kinds of credit.

Protect Yourself

Be wary of credit counseling organizations that:

• Charge high up-front or monthly fees for enrolling in credit counseling or a DMP
• Pressure you to make "voluntary contributions" which is another name for fees
• Won't send you free information about the service they provide without requireing you to provide personal financial information, such as credit card account numbers and balances.
• Try to enroll you in a DMP without spending time reviewing your financial situation.
• Offer to enroll you in a DMP with out teaching you budgeting and money management skills.
• Demand that you make payments into a DMP before your creditors have accepted you into the program.

Visit www.ftc.gov for more information.

Credit Repair Fraud

All consumers now can obtain a free credit report once a year through the Federal Trade Commission at www.annualcreditreport.com or can be ordered toll-free at 1-877-322-8228

Everday, there are companies nationwide that appeal to consumers with poor credit histories. For a fee, they promise to clean up your credit report so you can obtain a car loan, a home mortgage or even get a job. Unfortunately, many of these can't deliver. After paying these companies hundreds or thounsands of dollars in upfront fees, these companies do nothing to improve your credit report and many simply vanish with your money.

The truth is, no one can legally remove accurate and timely negative information from a credit report. The law does, however allows you to request a reinvestigation of information in your file that you dispute as inaccurate or incomplete. There is not charge for this. Everything a credit repair clinic can do for you legally, you can do for yourself at little or not cost. According to the Fair Credit Reporting Act, you are entitled to a free copy of your credit report anytime you've been denied credit within the last 30 days. You can also dispute mistakes or outdated items for free. Ask the credit reporting agency for a dispute form or submit your dispute in writing along with any supporting documentaion.

If you decide to respond to a credit repair offer, your BBB suggest you beware of companies that:

• Do not tell you your legal rights & what you can do - legally for free
• Recommend that you not contact a credit bureau directly
• Want you to pay for credit repair services before any services are provided
• Advised you to dispute all information in your credit report or take any action that seems illegal, such as creating a new credit identity by obtaining a federal employer identification number to use instead of a social security number. If you follow illegal advise and commit fraud, you may be subject to prosecution.

It's a federal crime to make false statements on a loan or credit application, to misrepresent your Social Security Number and to obtain an Employer Identification Number from the Internal Revenue Service under false pretenses.

If you have a complaint about a credit repair clinic, contact your BBB, your state attorney general's office and the Federal Trade Commission.

Mystar Financial Solutions Inc. is a BBB accredited business

www.mystarhelp.com or call (317) 284-6500 or (877) 284-6545

 

Will Credit Counseling Hurt My Credit Score?

Will Credit Counseling Hurt My Credit Score?. Article by Stacy Johnson from Moneytalksnews.com

Take a few moments and call Mystar today.  Mystar is BBB accredited and offers certified, experienced, professional counselors.  There is no charge to talk with a Mystar counselor.  Call Mystar @ (317)284-6500 or visit Mystar on the web at www.mystarhelp.com.