Minimum Credit Card Payments going up

Minimum Credit Card Payments are going up. Yes the pain will be felt world wide on this one.

New federal guidelines that require significantly increased monthly minimum payments will hit second half of this year. What does this mean to you as someone who carries a balance? Your minimum payment will go up. But let me give you more details…

How does this affect the borrower and the bank?
You monthly payment goes up. This means if you can barely make your minimum payment now, it will get much harder to make the minimum payment in the very near future.

Banks don’t like this not because it will force more people to pay off their debt faster but because it will mean more people will default on paying there debt.

“Banks will not only have increased losses, but reduced revenue as well,”

So please if you can start paying off your credit cards as soon as you can. Don’t let this new law force you over the edge into Bankruptcy.

Letter Requesting Settlement

Sample letter: (This is a sample and does not qualify as legal advice. Please consult your attoreny before using this letter.)

Suggested Settlement Letter

I, YOUR NAME HERE, will pay your company, CA NAME, the amount of $XX as full settlement of this account.

If you accept this agreement, I will send you a money order or certified cashiers check for the settlement amount of $XX in exchange for a full deletion of all references regarding this account from my credit profile and full satisfaction of the debt.

This agreement is binding and will be void should you not hold up to your end of the agreement. Furthermore the debt will be deleted from my credit profile at all three credit bureaus or the bureaus your company regularly reports to in the course of doing business.
If you agree to the above, please acknowledge with your signature and return a copy to me. Upon receipt of this signed acknowledgment, I will promptly send you a money order or cashiers check in the amount stated above.

The alleged debtor, YOUR NAME HERE, does not admit liability for the claims made by COLLECTION AGENCY. The purpose of this settlement is merely to avoid the potential future costs of litigation. Both parties agree that this settlement for X% of the disputed debt shall be confidential and in no way an admission of liability or acknowledgment that the debt is valid.

Both parties agree that no future reporting or verification of the alleged debt shall be provided to any credit bureau.

Notice: This agreement is restricted. This is not a renewed promise to pay but rather a restricted settlement offer only. By not signing below, you agree that the debt has not been renewed nor have any concrete written agreements been exchanged.

Creditor’s Authorized Signature: ____________________________________


Sample letters

Looking for sample letters to help your credit situation. They have the following letters:
Letters to Validate
Letters To Dispute
Letters For Debt Settlement
Administrative CRA Interaction
Other Letters

They can all be found at the link below:

emergency fund

I would highly encourage people to set aside at least $1000 in an emergancy fund. Do this so when Murphy’s law strikes you will be ready to pay in cash and it won’t throw off your game plan to crush debt. I see it happen time and time again.

If you have the $1000 in the bank great. Add to it if you can.
If you don’t have the $1000 in the bank start adding as much as you can to get the fund in place.

Finally someone speaking my language

Finally someone is talking the truth about getting out of debt! While this plan may seem simple it is actually the only method I would recommend.

    Kudos to the Author for telling the truth about debt relief.

Stack Your Debts: A Simple Four-Step Plan to Reducing Your Debts
By Jamie Jefferson

Are you feeling trapped by debts you accumulated long ago?

If you are able to pay your current expenses – and aren’t sinking further
into debt – but you’re still feeling dragged down by old debts and
nagging monthly minimums, this plan is for you.

It’s a simple four-step process you can follow to help you regain control over
your finances.

Step 1 – List all of your debts, starting with your smallest debt (no
matter what the interest rate), and followed by your larger debts. In your list,
write down your largest high-interest debts (such as those from credit cards) before
your largest low-interest debts (such as lines of credit.)

Step 2 – Continue to pay the minimums on all debts and put extra money
toward the smallest balances first. When you do so, you will feel
motivated and empowered in the debt-elimination process and soon you’ll
be paying off even more of those debts, and crossing the debts off your
list, one by one.

Step 3 – Roll your payments forward. When you have paid one debt
completely, add the funds that you were paying toward that debt
to the next debt on your list. For example, if you are making $150
payments to your smallest debt, you would add that $150 each month
to the next debt on your list once the smallest debt is paid off.
When the second debt is completely paid, roll all of these payments
to the third debt until all debts are paid.

Step 4 – When all of the debts on your list have been paid off,
take the money that you had been using to pay these debts and put
it in savings or toward your investments. This will insure that you are
not creating a higher cost of living for yourself once your debts
are paid.

This simple plan can help you develop the discipline for a bright
financial future as it helps you to pay off debts fast.

Jamie Jefferson reviews a
debt elimation program here which goes more in-depth on this debt stacking
process. And you can read more debt elimination strategies on the momscape site.

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terminating Credit Card Debt Scam

This is a great Article about terminating Credit Card Debt. Folks its a scam so read this article and learn so you don’t give your hard earn cash to any of these companies.

The “Credit Card Debt Termination” Scam
By Charles Phelan

“Legally terminate credit card debt! You can be debt-free in 4-6 months!” Advertisements like this are for a new type of program that has spread via the Internet over the past few years. It’s called “Credit Card Debt Termination,” and victims are paying $1,000s for this bogus service. One victim I spoke with lost more than $15,000! In this article, I’ll review the principles behind this program and explain exactly why it’s a scam to be avoided.

First, let’s get our definitions straight. The scheme I’m describing here should not be confused with Debt Consolidation or Debt Settlement (also known as Debt Negotiation), both of which are legitimate and ethical methods for debt resolution. The easiest way to distinguish the Credit Card Debt Termination scam from other valid programs is based on the central claim that you really don’t owe any money!

With Debt Consolidation, you pay back all of your debt balances. With Debt Settlement, you pay back a lower amount (usually around 50%) while the creditor agrees to forgive the remaining balance. However, with the bogus Credit Card Debt Termination program, promoters claim that you won’t need to pay anything at all (except their outrageous fees, naturally). They make the surprising claim that you can legally wipe away your debts simply by using their super-duper magic documents. Based on some legal mumbo-jumbo, the claim is made that you really didn’t borrow any money from your creditors!

In order to understand this scam, a little background is necessary. Remember the tax protest movement back in the 1970s? People were claiming that the IRS tax collection system was unconstitutional, and based on their misinterpretation of the tax code, they refused to pay taxes. The IRS came down hard on the tax protest movement, and through the court system, they blew holes in all the legal arguments put forth by the protesters. The Credit Card Debt Termination scam is a lot like the tax protest movement. In fact, among collection professionals, it’s called the “monetary protest movement.”

Just like the tax protest movement, there is a common theme that runs through all of the promotional materials issued by the monetary protestors. The basic idea is that our Federal Reserve monetary system and generally accepted accounting principles (GAAP) do not permit banks to loan out their own money. Therefore, according to their interpretation, the credit card banks are the ones running the scam on the American public.

Stay with me here, because the logic is pretty strange. If a bank cannot lend its own money, how does a credit card bank extend credit? The claim here is that your credit card agreement itself becomes a form of money (known as a promissory note) the moment you sign it. The idea is that the bank “deposits” your agreement as an asset on their books, and then any credit you use is offset as a liability against that asset. In other words, the core concept here is that you literally borrowed your own money from the credit card bank.

So let’s say your balance with ABC Credit Card Bank is $10,000, which you borrowed against the card to make everyday purchases. The scam promoters say all you need to do is notify the bank that you want your original “deposit” back. However, you will permit the bank to offset the amount you borrowed against the amount you have on “deposit.” Presto! You don’t owe the balance anymore!

Now, as you can imagine, the banks don’t take kindly to such tactics. Many of the consumers using this technique are getting sued by their creditors. But the scammers have more tricks available, as if the “smoke and mirrors” financial nonsense wasn’t enough. One of their techniques is the use of bogus “arbitration” forums. Arbitration is of course a legitimate system that allows businesses and individuals to resolve disputes without going to court. What do the scammers do? They coach people on how to set up a fake arbitration forum, for the express purpose of making a dispute against their creditors! Naturally, the creditors will not send representatives to some non-existent arbitration forum, so the consumer gets to rubber-stamp their own arbitration award. If they get sued in a regular court, they present their bogus award to the judge in the hopes that the creditor’s lawsuit will be dismissed.

There are other techniques used by promoters of this scheme, but the key point to remember is the central claim that your credit card debt does not really exist. Of course, it’s all nonsense based on a misinterpretation of our monetary system, and if you step back and think about for a minute, the truth seems pretty obvious. What these scammers are saying is that the entire $700 billion credit card industry is operating on an illegal basis! Even if the legal theory used by the promoters were true (which it isn’t), do you think for a moment the government would allow this giant industry to go under? That’s exactly what would happen if the promoter’s claims were proven true and used on a widespread basis.

The Federal Trade Commission, which has jurisdiction here, hasn’t stomped on these con artists yet, but it’s only a matter of time. Unfortunately, in the meanwhile, consumers are being bilked out of millions of dollars for a worthless program that will only get them into deep trouble with their creditors. If you are approached by someone offering to wipe away your debts using this system, I strongly recommend you run in the other direction while you hold on tightly to your wallet or purse.

Remember, you can eliminate your debts if you take a disciplined approach to your finances, make a budget and stick to it, and don’t use your credit cards unless you can pay off new balances in full each month.

Good luck in your financial future!

Charles J. Phelan has been helping consumers become debt-free without bankruptcy since 1997. A former senior executive with one of the nation’s largest debt settlement firms, he is the author of the Debt Elimination Success Seminar™, a five-hour audio-CD course that teaches consumers how to choose between debt program options based on their financial situation. The course focuses on comprehensive instruction in do-it-yourself debt negotiation & settlement designed to save $1,000s. Personal coaching and follow-up support is included. Achieves the same results as professional firms for a tiny fraction of the cost.

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Get out of debt fast. Three simple steps

Get out of debt fast. Three simple steps

Reduce your interest rate
First call your Credit Card company and ask them if they will reduce the rate on your credit card. They will only do this if you are in good standings. So no late payments over the limit issues, etc. Most of the time they should at the very least give you a temporary rate reduction and if your luck they will give you a permanent reduction. You may want to stress the fact you are a very good customer. All they can say is no and you have a 50% chance of getting the rate down.

Pay more than the minimum
This is a must. Pay as much as you can above the minimum required on the card. You will increase your payoff time drastically. We are talking by years. Skip the Starbucks coffee or eat out 2 less times a month. Do anything you can to find an extra $100, $200 or more and start to pay that balance down fast.

Create a snowball effect
Once you have paid off one debt use the money allotted to that old debt to any new debts you have instead of using it on other things. Keep hammering away at your debt and you will see huge progress. The key is to stick with it.


I get a lot of questions about what exactly debt consolidation is. So here is a quick over view of what DC really is.

This can take the form of any of the following:
• Borrowing money to pay off debt
• Borrowing against the equity in your home to pay off debt
• Service provided by both for-profit and non-profit companies who negotiate better rates with your lenders and give you one lump sum payment and then they turn around and make the payment on your behalf
• Bankruptcy