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How to Prevent Identity Theft While Away at College

Identity Theft

If your child is on his way to college, you have likely armed him with a laptop, a credit card, a debit card or other source of income. But a trip to college can leave your child susceptible to identity theft. It is therefore extremely important to not only leave your child with plenty of well wishes, but a plan of action to prevent identity theft, as well.

Here are ways your college student can help protect himself from identity theft:

• Lock the door room door. This can’t be overstated, as this single piece of advice can prevent most thefts while away at college. Many college students inadvertently leave their dorm room door open, even if it’s just for a few minutes to greet a friend or fetch their meal, and find their belongings – and often their identity – stolen.
• Mark all personal property clearly. Personalizing your laptop in a visible way is a great way to deter theft, as a thief won’t want to be caught with an easily identifiable laptop.
• Don’t leave your personal computer or laptop vulnerable; use password protection. Your laptop should be protected with a password, as to prevent another individual from quickly logging on and obtaining your personal information.
• Watch what you reveal on social networking sites.– Many identity thieves look for individuals who inadvertently share personal information with others on social networking sites, such as Facebook and MySpace. As such, never share your birth date, address or any other information that can be used against you.
• Write down your laptop’s serial number, make and model and keep it in a safe place so you can provide this information to campus police if your laptop should be stolen. You may also be able to file an insurance claim for your stolen laptop, and you will need this information to do so.
• Get a shredder and use it. One of the easiest ways for an identity thief to obtain your personal information is by simply looking through the trash. It is therefore always best to shred any personal or financial information, such as bank and credit card statements.
• Ask the college about network security and learn how to protect yourself and your personal identity found on your computer.

Credit Score Information to Remember

Credit Score

You may think you have a fairly good understanding of your credit score and what it means to you and your ability to obtain credit.  But a credit score is a pretty in-depth bit of information, and understanding it better can only help you in your quest to obtain a strong credit score.

Here’s what you need to know:

• Every time you seek credit, the lender will look at your credit report. Simply put, there is no way to get around a poor credit score because lenders use this information to make a determination about your credit worthiness.
• All of the three, major credit bureaus in the United States track your borrowing behavior. Experian, Equifax and TransUnion all keep detailed records of your borrowing history. So, every time you are loaned money, the details of that loan will be present on your credit report. It will detail the amount of the original, the current balance of the loan, and the payment history on the loan.
• Your credit report includes a plethora of financial and personal information, including your account history, your balance, your monthly payment, your payment history, your payment status, information from public records, tax liens, monetary judgments and even overdue child support payments. So anytime a lender or creditor pulls your credit report, he or she is essentially getting a snapshot of your life.
• Not all credit report information is accurate, and mistakes found on your report can cost you big. The three credit reporting bureaus are not immune to mistakes or inaccuracies. As such, you could have inaccurate information appear on your credit report; information that could ruin your chances of obtaining credit. Because of this, it is vital that you periodically check your credit report for inaccuracies or other errors. If any inaccurate information is found, it is up to you to immediately contact the appropriate credit reporting bureau.
• The Fair Credit Reporting Act entitles everyone to receive a free copy of their credit report once every 12 months. You are also entitled to a free copy of your credit report if you were denied credit for any reason.

Personal Checks or Credit Cards: Which is Best?

Choosing Credit Card

Personal checks used to be the way to go. Whether you were buying groceries or a sweater from your favorite department store, you often used a personal check or cash. Although personal checks still serve a purpose in today’s society, there may be a smarter route to take when it comes time to pay for your purchases: a credit card.

Credit cards simply offer better safety and security over personal checks, for a number of reasons:

• Checks can be stolen – If you use checks to pay bills, you may be surprised to find that check thieves will steal checks from the mail, “wash” them of their information, and use them to withdraw large sums of money from your checking account. In addition, carrying around your checkbook in your purse could also spell trouble if your purse is stolen. Although most banks have fraud protection in place to protect your money, the hassle of having your bank account drained is trouble in itself.
• Checks can trick you – Writing checks can often be tricky, as they don’t always appear right away. As a result, if you don’t keep super-accurate records of your check writing, you could be fooled into thinking you have more money in your account than you actually do. As a result, you could end up overdrawing your account, which may result in bounced check fees or overdraft fees.
• Checks are not always easily accepted – Unlike credit cards, which are now accepted at millions of places worldwide, cashing a check or using a check to pay for purchases is not always easy. Some retailers do not accept checks; others demand other forms of identification to cash a check. In other words, writing a check is often simply not worth the hassle.
• Checks cost money – Ordering checks costs money. Sure, it may be only $20 or $30 each year, but if you don’t need to pay this, why bother? Paying with a credit card, on the other hand, costs no money.
• Checks can’t be used online – Even if you enjoy using checks, if you purchase goods or services off the Internet, you will likely need to use a credit card to complete the transaction, as most online retailers do not accept checks.

The Steps Creditors May Take to Collect Past Due Payments

Credit Repair Credit Score

If you miss a credit card payment, do you know what steps your credit card company will take to collect their money? Unfortunately, many people have fallen behind on their credit card payments over the last, few years; and, as such, credit card companies have had to collect their money.

Here is what you can expect if you fail to make a credit card payment:

• You miss your due date – You will likely receive a few, polite phone calls to remind you of a missed payment.
• You are 30 days past due – Someone who is 30 days past due on their account will have likely missed the payment before the next billing cycle rolls around. In this case, the creditor will likely use “soft tactics” to receive their payment. You may expect to receive phone calls, emails and letters, although all of these tactics will be decidedly patient and helpful. Once 30 days has passed without a payment, the creditor will likely report you to the credit bureaus as delinquent.

Now is a great time to ask your creditor to help you find solutions to your financial problems. During this stage of the game the creditor will likely negotiate more manageable payment arrangements with you. Don’t, however, avoid the creditor and ignore the problem; it will only make things worse.

• You are 60 days past due – OK, now things are really starting to look bad. You’ve missed two billing cycles and the creditor has almost certainly reported your account as delinquent to the credit reporting bureaus. Plus, they are also likely not so nice anymore. Most creditors will issue a warning telling you that if you don’t pay on your card it could end up in serious delinquency.

It’s not too late to talk to your credit card company about working together to find a solution to your credit card woes.

• You are more than 90 days past due – Many creditors will simply write off the debt as a charge-off if you fail to pay for three or more months, meaning that it will go to a third-party collections agency who will, no doubt, employ more aggressive tactics to get their money.  Your debt with the creditor could ultimately be brought to court, as well, resulting in wage garnishment.

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How to Find a Qualified Credit Counselor

Credit Repair

If you have been struggling with your credit, you may have heard that a qualified credit counselor may be able to help you manage and overcome your credit woes. Although there are many credit counseling agencies out there that can help you navigate your credit problems and work with your creditors, there may be just as many companies that lack the reputation and the know how to get the job done.

If you are struggling to keep your head above water and your debts are overwhelming you, it may be time to call in the help of a qualified credit counselor. Here’s what to look for in a credit counselor:

• When searching for a credit counselor, look into national organizations, such as the National Federation for Credit Counseling or the Association of Independent Consumer Credit Counseling. Any company that is affiliated with a national organization such as these will have to adhere to strict guidelines and codes of ethics.
• Contact the Better Business Bureau and/or your state attorney general to see if there have been any claims or disputes against the credit counseling agency. Of course, if you find a long history of complaints against the company, it is probably best to steer clear.
• Learn about the company’s procedures regarding payments to your creditors. Most credit counseling companies will get you into a debt management plan, and they will ask you for payments that will be passed onto your creditors. However, they will also likely charge additional fees to do this. Make sure you fully understand how their system works and how they will pay your creditors.
• Beware of lofty promises. In short, beware of any company that promises to get you out of debt in a short period of time or fix your credit in a matter of months. The truth is that a credit counselor can simply negotiate better terms and lower payments with your creditors; not fix your credit. Timely payments over a period of time are the only thing that will fix your credit.
• Get everything in writing. Don’t take a credit counselor’s verbal promises and run with them. The only type of agreement you should consider is a written one.

Past-Due Credit Cards and Wage Garnishment: What You Need to Know

Introduction

If you fail to pay your credit card bills, your creditors may be able to come after their money through the courts and win a settlement against you; a settlement that includes a wage garnishment.

Here is what you need to know about wage garnishment:

• Wage garnishment is regulated by state law, although some federal laws may exist when it comes to wage garnishment, as well.
• In general, about 25 percent of your after-taxes wages can be garnished by your creditors. As a result, regardless of how many creditors obtain an order of garnishment from the courts, the total amount of your garnished wages cannot, in general, exceed 25 percent of your after-taxes earnings.
• There are a number of ways to prevent wage garnishment. Contact your creditors and set up a payment plan. Make sure you clearly communicate your desire to pay back your debt, but that you need a more affordable payment plan. Ask your creditor to send you the updated payment plan in writing for your records. Most creditors will agree to a smaller payment each month, provided you keep true to your word and pay every month. If you set up a payment plan and then fail to keep up your end of the deal, expect your creditor to take legal action.
• If the creditor does not agree to a more manageable payment plan, know that you have rights. You have a right to defend yourself in a court proceeding where the creditor is seeking wage garnishment. If you show up to the court date, show the judge your records and explain your attempts to make good on the debt; it is likely the judge will require the creditor to accept your payment plan.
• Keep in mind that wage garnishment is the last resort for most creditors, and you should make every attempt to clear your debt and find a solution to your debt problem before a court proceeding and wage garnishment take place. Cut down on your spending, consolidate your debts, or contact a credit counselor, if necessary.

When You Can Claim a Free Copy of Your Credit Report

Credit Score

We all know that keeping a close eye on our credit report is one of the best things we can do to ensure our good credit is protected. However, did you know that there are some instances when you can actually order a copy of your credit report, from all three credit reporting agencies, for free?

• The Fair and Accurate Credit Transactions Act (FACTA) allows consumers to order a copy of their credit report from all three, major credit reporting agencies (Equifax, Experian and TransUnion) once every 12 months. The easiest way to claim a copy of your credit report is by visiting www.annualcreditreport.com and filling out the Annual Credit Report Request Form found there. You must request your free credit reports through annualcreditreport.com, and not through the individual credit reporting agencies.
• Under the Fair Credit Reporting Act, you are entitled to a free copy of your credit report, from the three, major credit reporting agencies if: you have been denied credit; if you have been denied employment because of your credit; if you have been denied housing because of your credit; or you are forced to pay a higher insurance rate because of your credit.
• Under the Fair Credit Reporting Act, you are also entitled to a free copy of your credit report from all three credit reporting agencies if you placed a fraud alert on your credit report or if you are a victim of identity theft.
• Under the Fair Credit Reporting Act, you are entitled to a free copy of your credit report if you were involved in a dispute regarding your credit report. A good example of this is if you find inaccurate information on your credit report and the appropriate credit reporting agency changed the information on your report to reflect the inaccuracy. Once the investigation has ended, you are entitled to a free copy of your credit report to make sure your updated credit report reflects the changes. Remember that, under the Fair Credit Reporting Act, the credit agency in question must address and settle your dispute within 30 days.

What You May be Surprised to Find on Your Credit Report

Credit Score

We all know that a credit report is the final word when it comes to obtaining credit. Our credit history, our credit payments and our debt load are all detailed on our credit report. However, your credit score may be influenced by a number of other things, as well; things you may have never guessed!

• Library fines – Some libraries will send your overdue fines to the credit reporting agencies. Surprised? Because these types of fines are most commonly ignored or forgotten, municipalities have gotten smart and started reporting individuals to the credit reporting agencies.
• Parking/speeding fines – Municipalities are also getting into the game when it comes to parking and speeding tickets. In fact, it is becoming quite common for municipalities to report these unpaid fines directly to the credit bureaus. As a result, many individuals take these fines much more seriously.
• Cell phone bills – Although the regularity at which cell phone companies report missed payments to the credit agencies depends on the service provider, it is true that many cell phone providers have begun forwarding this type of information onto the credit reporting bureaus. Many cell phone providers report unpaid cell phone payments as credit accounts, thereby immediately affecting your credit score.
• Child support – The Fair Credit Reporting Act treats child support like any other type of debt. As a result, courts furnish child support payments – whether on time or delinquent – to the credit reporting agencies. However, it is important to note that, although child support payments are recorded on credit reports, they do not affect an individual’s FICO score. Keep in mind, though, that an employer may look down upon someone who shows delinquent child support payments on their credit report.
• Utility payments – If you fail to pay your electric bill or your water bill, expect the company to furnish this information to the credit reporting agencies. Although a missed payment or two will not likely get reported, if you are consistently past due, you may find this information on your credit report. In short, it is important to treat all bills – not just loans and credit cards – equally because they may all play an important role on your FICO score.

How to Keep Yourself Out of Credit Card Trouble

Introduction

Although you may think you have your credit cards under control, the truth is that many consumers make a number of mistakes that can change their credit standing from excellent to “you don’t even want to know.”

If you want to play it safe with your credit cards and protect your strong credit score, it may make sense to adhere to the following rules:

• Slow down when it comes to getting credit cards – The more credit cards you have in your wallet, the more chances you have for making mistakes. The bottom line is that too many credit cards spell trouble for many consumers. One major credit card with a competitive interest rate, along with a credit card for emergency use, are all most people really need to have.
• Say NO to retail credit cards – Retail or store credit cards may seem like a great deal, as they usually offer coupons and special shopping events for cardholders. However, they also offer high interest rates, which can cause balances to spiral out of control in a short amount of time. Unless you can commit to always paying your balance in full, each month, it is best to steer clear of store credit cards.
• Always read the fine print – Before you jump on the next credit card offer that flaunts a low, introductory rate, take the time to thoroughly read and understand the card’s terms and conditions. A low, introductory rate may seem like a great deal; until, of course, the introductory rate has ended and you are faced with a high interest rate and related fees.
• Pay more than the minimum payment – It may be quite simple to just send the minimum payment into your creditor and pocket the rest, but the fact of the matter is that paying just the minimum payment will get you nowhere fast.  If you cannot pay off your credit card balance in full each month, remove the credit card from your wallet and pay as much as you can each month until the card is paid off. It just doesn’t make sense to keep spending and sending only the minimum payment in each month because your monthly finance charges will quickly take over.

How to Deal with Debt Collectors

Credit Card Debt

Although it’s something we want to avoid at all costs, the inevitable can and often does happen: we fall behind on our bills.

One of the first forms of communication between you and your creditor may be a courteous phone call or letter. But, if you fail to remedy your delinquent account, the creditor may become more aggressive. If you have begun receiving phone calls from creditors or debt collectors, you need to understand your rights and take immediate action. Here’s what to do:

• If you are having difficulty paying your bills, or your credit card’s minimum payment has become too much to handle each month, take a moment to contact your creditor before you miss a payment. Often times, creditors will work with you to set up a reasonable payment arrangement before your account heads to a debt collector.
• Read up on your rights through the U.S. Federal Trade Commission (FTC). The FTC has a number of publications that can provide you with information regarding the Fair Debt Collections Practices Act. This Act essentially makes it illegal for debt collectors to make threatening, harassing or nuisance phone calls. If you are being harassed by a debt collector, or feel that the debt collector is not abiding by the laws outlined in the Fair Debt Collections Practices Act, you should immediately contact the FTC and file a complaint.
• It is important to realize that debt collectors do not go away very easily, so instead of ignoring the problem, face it head on. Begin by asking for written verification of your debt so you can get a good understanding where you stand.  The Fair Debt Collections Practices Act allows consumers to ask for this written information within 30 days of being contacted by a debt collector.
• If you are deep in debt and debt collectors are threatening wage garnishment, it is vital that you contact a consumer lawyer. Without a professional on your side you could be charged with paying much more than you actually owe. If you have a lawyer representing you in court, you have a much greater chance of paying less or having your case dismissed.