I saw a chart in a bill-paying notebook today that had what you would pay per day on a $100 loan with varying interest rates. It had across the top day 1, 2, 3, 4. Then along the side of the chart it had 1/2%, 1% and so on. My “trying to save money” self just couldn’t spend the $2 on the bill organizer for that chart. I’ve surfed online to no avail. Do you have something like that you could show your readers? When we started ‘totaling’ the interest we paid each year for accounting purposes we were stunned.
Autumn in Michigan

Autumn has discovered something that most consumers haven’t learned. A great deal of your hard-earned money each month goes to paying interest on the money that you’ve borrowed.

Rather than put together a chart for Autumn, let’s show her how to assemble her own.

The formula for calculating interest expense isn’t as hard as you might think. We’re going to break it down to make it extremely simple.

The formula is the amount of money borrowed X the interest rate X the length of time that the money is borrowed for.

The amount of money borrowed should be easy to determine. Whether its a mortgage, car loan or credit card balance, your statement should list the balance due (i.e. the amount owed). If it doesn’t you can call the lender and ask them for a current balance. Remember, this is not the amount that you borrowed originally. It’s how much you still owe today.

The interest rate tends to confuse people because it is stated as a percentage. And with percentages come decimal places. But, we’re not going to let a little old decimal point stop us.

An easy way to think of interest rates is to look at the percent sign (%) and see two zeros or two decimal places. So 11% would be .11 and 5% would be .05.

In the real world, most interest rates aren’t exactly even. For instance, your home mortgage might be 5 3/8% or .05375 or a car loan at 11.75% or .1175.

If you still find it confusing, try this trick. Think of 100% as the whole amount. So 100% would translate to 1.00. Which is just what you’d expect it to be.

Finally, let’s consider the length of time the money is borrowed for or how long is it between scheduled payments. Let’s use monthly since that’s the most common.

Almost all interest rates are quoted for a one year period. If we’re making a monthly statement/payment, we’ll need to factor that in. One month is 1/12th of a year or .0833.

Let’s fill out our formula. Suppose that we were borrowing $100 at 14.5% for one month. Filling in our formula we’d get: $100 X .145 X .0833. Or $1.21 in interest due for the month. Using this formula Autumn can calculate any box in the chart.

Another way to get a feel for how much interest is costing you is to look at your monthly statements. Many will tell you exactly how much the interest added to your debt since the last statement. If a statement doesn’t clearly say that just call the lender and ask them. They can tell you to the penny how much interest you’re paying.

Now Amber can make her own chart. Better yet, she can know what each loan is costing her and total them all up to find out how much extra money she’d have each month if it weren’t for her debts. For many people that’s a great motivator to getting them paid off.

______________

Gary Foreman is the editor of The Dollar Stretcher.com website and enewsletters including Financial Independence.

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One of my favorite quotes comes from Henry Ford. “Thinking is the hardest work there is. That’s why so few engage in it.” Old Mr. Ford was an interesting man. He made some very good decisions (produce an affordable car for the average man, use an assembly line with interchangeable parts) and some very bad ones (sticking to old designs too long). That makes him a perfect person to help us understand an economic concept called “opportunity cost.”

What is opportunity cost? It’s a theory that states something that we already know. Sometimes you have two or more alternatives, but you can only choose one. To put it in a more scholarly way its choosing between mutually exclusive choices.

For example, suppose you were shopping for a new car. You’ve narrowed it down to a minivan and SUV. Both about the same price. You have to choose between the two. You cannot have both.

After test rides you decide to choose the minivan. That’s your opportunity. The ability to choose the van. The cost is the loss of the SUV.

A another way to think of it is ‘instead’. If I go to a restaurant, I can choose the meatloaf instead of the fried chicken. But if I’ve already eaten the fried chicken, I’ll be too full to try the meatloaf. So choosing one eliminates the other.

The theory of opportunity cost relates to both our time and our money. Let’s consider a college student. Suppose that spending a semester in college costs $6,000 (including all fees and living expenses). But that’s not the real cost. The real cost would include the $8,000 he could have earned if he were not busy in college. So the true cost is $14,000.

The same is true on a smaller scale. I can choose to clean the gutters or watch the football game. I can’t do both. If I decide to watch the game the gutters will continue to be full of leaves. Making the same decision weekend after weekend could lead to damage to the house. In effect, the cost of watching the games was the repair of a leaky roof.

But, let’s get back to Mr. Ford. What makes him such a prime example for opportunity costs?

The initial Model T Ford sold for about $500 (depending on model and which year it was purchased). People who bought a Model T could have spent that money in other ways (farm equipment, newly invented labor saving devices for the home like washing machines or vacuum cleaners, etc). The opportunity cost to buying the Model T was that they couldn’t buy the other things.

By stressing a mass market and low prices, Ford lowered the opportunity cost of his car. People had to give up less stuff to buy one. As a result Ford sold nearly 15 million cars between 1909 and 1927!

But, Mr. Ford also made some bad choices. He stayed with the Model T too long. By staying with the Model T, Ford couldn’t introduce an all new car. That was the cost of sticking with the T. It was an expensive decision. From 1920 to 1926 Chevrolet’s production went up by 400%. Ford’s decreased by 20%. Ford’s early dominant position in the industry was lost.

What can we learn from Henry Ford’s example? Mainly that we should think before we make big decisions. Often the opportunity costs aren’t that apparent. Had Ford recognized what it was costing him he probably would have replaced the T earlier.

We need to do the hard work of thinking, too. The cost of that minivan might not just be the SUV that we didn’t buy. It might mean that a change in income could force Mom into an evening job to make the payments. The cost of being away from her children could be very expensive (lower grades, teen pregnancy, gang involvement). Take the time to consider the different alternatives and how each option could play out in the future.

Henry was right. Thinking is hard work. But, it can also be very well paid work, too!

______________

Gary Foreman is the editor of The Dollar Stretcher.com website and enewsletters including Financial Independence.

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You see much in the media about federal and state government debt. Most of the reports concentrate on the big picture. How many trillions of dollars the U.S. federal government owes. Or how many billions short a particular state budget is.

But few seem to address what that debt means to the average person like you and me. How our lives are changed by the debts that our federal and state governments take on.

According to USDebtClock.org the average U.S. Federal Government debt per citizen is over $42,000. And, they calculate that the interest per citizen at $2,800 per year.

So that means that you’re paying $233 per month just to cover the interest. So it’s a little like you and your mate are making a car payment every month for the rest of your lives. Not to buy you a dependable set of wheels, but to pay the interest on the money that’s already been borrowed in your name.

For a family of four it’s like having two new cars stolen from your driveway. If you’re a car salesperson those are two cars that you can’t sell because the customer can’t afford them. If you’re an autoworker, those are two cars you don’t get to build. Government debt takes money out of our pockets that could otherwise be spent and create jobs.

Maybe your taxable income is low. In fact, maybe you don’t pay any taxes at all. So why should you care? You’re not going to be paying any of that interest. That’s for someone wealthier than you.

Well, you’re affected, too. Every time that you go to borrow money you’ll pay more because you’re bidding against the government. That’s right. The government borrows it’s money from the same places that you do. So you have to outbid them to borrow money for your mortgage, car loan or credit card account. Instead of borrowing at 8% you’ll need to pay 9 or even 10%. And, the more they borrow the worse it gets.

You don’t need to pay taxes or borrow money to be affected by government debts. If you benefit from any government service you can look forward to cuts in that service. With more of the government budget going to pay for interest, there’s less available to pay for roads, school lunch programs or any other government services.

So what should you do now to protect yourself?

Expect to see government look to save money in all areas. Be prepared to receive lower benefits on government programs. That includes Medicare, Medicaid, Social Security, even government pension benefits. You may be fortunate and not have your program cut. But, you’d be foolish to think it couldn’t happen.

The next obvious step is to pay off any debt you currently owe. That eliminates the need to compete with the government to borrow money. Plus you’ll have more flexibility so you can adjust to a changing financial environment.

Also, be prepared for inflation. Unlike you and I, the government can print more money. That allows them to repay their debts in cheaper dollars. However, there is a cost. An increase in the money supply will cause prices to go up. And, we’ll have inflation.

Some argue that government debt doesn’t matter. They say that the government doesn’t ever really have to pay back debts. Government can carry it forever. And, maybe that’s true. Up to a point. But just like your family budget, if you want to be able to keep borrowing money you absolutly must make your interest payments. Even if that means that your family can’t pay rent or buy groceries.

The same thing is true for the government. At some point the government won’t be able to pay the interest due and still perform essential government services. According to U.S. Controller General David Walker, within 12 years the largest item on the federal budget will be interest payments.

You may hear the argument that the government can’t quit spending in a recession – even if they have to borrow the money being spent. That ignores the simple fact that every borrowed dollar increases the amount of interest that we’ll pay next year and every year thereafter.

Someone might say that this article is political. It’s not meant to be. Debt doesn’t care which political party creates it. A dollar of debt created by either party will have the same effect on you. A state or country can’t continually spend money it doesn’t have. Any more than you or I could.

I’ll leave it up to you whether you want to contact your elected reps and tell them to balance any budget they’re responsible for. But, I’ll admit that paying for two non-existent cars that aren’t in my driveway isn’t very appealing. And thinking that my children and grandchildren will be paying for them too is even less appealing.

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Gary Foreman is the editor of The Dollar Stretcher.com. Check out their frugal living page and enewsletters including Financial Independence. Financial Independence is designed to walk step-by-step with you as you take control of your finances and achieve financial freedom!

Articles on this site have been acquired from a variety of sources. No content on this site should be considered financial or legal advice

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Dear Dollar Stretcher,
My grandson, financially overwhelmed, a corrections oficer in California, is getting paid only 3/4 of his salary due to California’s money problems. He is on sick leave due to injuries to his knee which he probably received on the job but is unable to prove it. He is to have surgery in about two to three weeks. The balance he owes on his house is more than the house is worth. He has two toddlers and his wife is a diabetic, has a pump and been advised not to work outside the home. He also has other debts. He is 32 and has never been in this type of situation. I asked him if he asked anyone for financial advice and he said he wouldn’t know where to go. I would appreciate any information you can give.
Thank you,
L.W.

Sounds like LW’s grandson has a lot on his mind. Sometimes that makes it hard to know where to focus our efforts.

Often it’s helpful to look at problems from different perspectives. We’ll begin by trying to understand each individual problem. Then we’ll look at the big, overall picture.

Based on Grandma’s email we’ll consider the following problems: Grandson’s salary, his health, his wife’s health, other debts, and their upside down home.

Grandson’s salary is likely to stay frozen for quite awhile. It’s public knowledge that California is having a severe budget crunch. So the only way to increase his income would be to find a new higher paying job.

Granddaughter, although not able to work outside the home, might be able to bring in some income. Between her health and the toddlers, work might be impossible. But it’s wise to ask the question. It’s surprising how many people bring in income with small home businesses.

While we don’t know what type of health insurance Grandson has, as a general rule county and state employees have plans that should cover all but deductibles for his surgery.

If he hasn’t already, Grandson should talk to someone in the worker’s comp office. Whether he’s eligible or not, it’s good to know for certain.

As to his home, the fact that he owes more than it’s current value probably isn’t important as long as he can continue to make the payments. Unless he’s planning on selling the house or can’t make payments there’s nothing that he needs to do.

While it may be tempting to walk away from a home that’s worth less than what you owe on it, as long as he can keep up with the payments and isn’t planning on moving he’ll want to stay in the house. Letting the home fall into foreclosure will crater his credit score. And, the bank would have the right to pursue him for any shortage when the home is finally sold. Plus, the amount of the shortfall will be added to his taxable income.

The fact that he has other debts isn’t surprising. Many young families do. But interest going to credit card companies can be especially painful if your finances are tight. Finding some way to repay those debts would be very helpful. If the credit card debt totals more than $10,000 he might want to consider credit counseling. Often then can get the interest rate reduced which makes it easier to pay down the balance.

Now that we’ve looked at each individual issue, we’ll take a look at the whole picture. It could be that when taken all together that a different picture might emerge.

There appears to be two overriding issues. Do they have enough income to support their lifestyle? And, will health issues force any changes?

Let’s begin by comparing income to expenses. If there’s a gap, Grandson will need to make some changes. The first is to increase income or reduce their standard of living. That may not be hard, but it is necessary. Putting it off now will only make it worse later.

If that’s not sufficient to close the gap he’ll need to begin credit counseling and consideration of a short-sale on their home. If that’s still not sufficient, then Grandson may need to consider bankruptcy.

Health issues could have a serious affect on their plans. Consultation with their doctors should give them an idea of whether any lifestyle changes are in their future. This is something that they’ll need to consider on a regular basis.

Grandson doesn’t need to feel overwhelmed by all the different events in his life. Looking at circumstances individually and then taking a ‘big picture’ approach will help him know what actions need to be taken to prevent big problems in the future.

______________

Gary Foreman is the editor of The Dollar Stretcher.com. Check out their frugal living page and enewsletters including Financial Independence. Financial Independence is designed to walk step-by-step with you as you take control of your finances and achieve financial freedom!

Articles on this site have been acquired from a variety of sources. No content on this site should be considered financial or legal advice

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The Dollar Stretcher Blog
by Gary Foreman

Hubby and I are a young couple with 3 children. My husband is hard working – 2 jobs and I am a stay at home mom. Things have gotten better over the years for us from where we first started out in life together but now that our children are growing older and we got a bigger house = higher rent and his work at his full time job has slowed down (no overtime), things have been getting tight. I have a busted windshield in my SUV and dead inspection for months on end now and my hubby’s car is on its last leg. He has a court date comming up in 2 weeks because our car insurence lapsed. So now we’ll more than likely have a huge fine we’ll have to come up with money to pay. Our electric is about to be turned off and rent is comming due next week. I do grocery shopping on Fridays and here it is Friday and hubby says he has no money for me to get food and things the kids need, once again… this is becoming a frequent thing. My SUV is on the verge of getting repoed if we don’t pay them by the end of the month. My husband is in almost cronic pain with neck and back problems caused by the strenuious work he does. We have insurance but he’s afraid to push the issue with fear of losing his job. I cannot work because I have a 2 year old daughter. I have no one to watch her and 2 boys to pick up from school each day at 2:30. My husband won’t let me help to set up a budget for us and control finances. He says there’s nothing to budget, money comes in money goes out. If he can swing it he gives me a little when he can to get food or diapers but that’s about it. I feel so powerless to help our financial situation. I have managed to put back $1100 from income tax return money which has now dwindled down to $500 but I have been hanging on to it for dear life because I hate to see it go. It’s all I got and so many places it could be used. Do you have any suggestions that would help me? Thank you.
Signed,
Powerless

“Powerless” has certainly given herself the right name. Given the current situation she is pretty powerless to do much to help their finances. But, she’s not alone. Her husband is powerless, too!

Right now there is no one who can help this family. The reason is simple. No one has enough information to know what the problem is.

Based on Powerless’ story we’d have to believe that her husband is a hard-worker. It’s also clear that they’re behind in their bills.

The key part of Powerless’ story is that her husband is unwilling to create a budget. I can understand why he’s reluctant. He’s probably already feeling closed in by the bills. He doesn’t need someone or something telling him what he cannot do. He’s got enough of that already.

But, he’s wrong about what a budget does. A budget doesn’t control spending. You control your spending. A budget is just a tool to tell you where you are spending money and whether your income is higher than your expenses. It’s really just a diagnostic tool. Nothing more.

Right now there could be a number of different reasons why Powerless doesn’t have money to buy food for her children.

Previous bills (think credit cards or personal loans) may be taking a large portion of their income. In that case, credit counseling or bankruptcy might be the best solution.

Their car payments could be too high relative to their income. Then the solution would be to trade to something with lower payments.

Hubby might be spending money before it comes into the house. We have to believe that Powerless’ mate is doing his best for the family. But, he wouldn’t be the first person to struggle with addictions or bad habits that consume his paycheck.

Or it could be that he just doesn’t make enough. Powerless might need to find a job in the evenings or create a way to make some money from home.

Based on Powerless’ email, you’d have to assume that they’re in pretty deep. Not the kind of situation where an extra few dollars each month would solve the problem. It would appear that only something significant could ease the continual financial pain.

So Powerless has a choice. She can collect enough financial data to determine what to do to fix their finances. Or she can continue to face a slowly worsening financial situation.

It might be hard convincing Hubby to go along. Perhaps if he can see that a budget isn’t a straightjacket, but rather a tool that he can use to solve the situation he’ll be willing to give it a shot.

Keep on Stretchin’ those Dollars!
Gary

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Gary Foreman is the editor of The Dollar Stretcher.com website and enewsletters including Financial Independence Financial Independence is designed to walk step-by-step with you as you take control of your finances and achieve financial freedom! Visit the site for more on how to get the most from a budget.

Articles on this site have been acquired from a variety of sources. No content on this site should be considered financial or legal advice.

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For this reason, lenders employ collection agencies to collect debt from you. Collection agencies are firms that are specialized in debt collection from people who defaulted in making payments. Some creditors will have in house collection team that acts according to guidelines of the creditors and some creditors sell the defaulted accounts to collection firms for partial amount with an intention to recover minimum amount of money they lend.

Debt collection is a business that collects amount on debts owed by debtors. Most collection agencies operate as an agent to creditors and collect debt on behalf of them which in turn charge a fee for the total amount owed.

Debt collection agencies while performing their business employ different methods to collect debt from the debtors. These methods can be threaten the debtor and feel harassed when the debt collector contact you. For this reason many are frightened of the debt collection term itself. Don’t worry every problem has a solution. If you are facing the debt collectors daily in an effort to settle the debt then you have definitely got a solution.

As more and more debtors are defaulting, lenders started to employ debt collection team to recover the amount. For this reason the number of people dealing with debt collectors has been increasing. In order to get rid of debt collectors many people are filling bankruptcy as they think this is the only solution to avoid them. But there are many other ways in which you can deal with debt collectors. Filling bankruptcy can spoil you credit in future – so don’t ever take this step to get rid of debt collection.

To deal with them, first know your rights as a debtor. The common opinion about the debt collection agencies is that they do not comply with rules. They keep making harassing phone calls and threaten you. Think once does any law permits anyone to threat others? No, then how can a debt collection agencies allowed to threaten you.

To know how to stop threatening you, start learning your rights with respect to law and start speaking law with them. Then they immediately close their mouth or speak smoothly to you. You can know your rights as a debtor by familiarizing fair debt collection practices act.

Second, know the statue of limitation of your state before confirming the call from the debt collector of that bill. If they keep calling then ask him to send the paper work regarding the bill. And if that entry is already for more than 6 and half years then it may drop from credit report. So for this reason don’t take any action with respect to that entry. It may drop of your credit report in other 6 months. To know this information make sure to ask for credit report from credit rating agencies and confirm the debt and know which are about to go off from the credit report and stay away from those.

Articles on this site have been acquired from a variety of sources. No content on this site should be considered financial or legal advice

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I quit paying ALL of my CREDIT CARDS ACCOUNTS because I may have to file bankruptcy???!!! BUT I have several charge offs on my credit now!! What should I do? Pay the collection agency which I heard, was NOT the way to go!! Does a collection agency report to the credit report paid in full if you try and pay off the balance owed?? Or should I just file bankruptcy? PLEASE HELP!!!! Thank you!!!
B.

Sounds like B is freaking over her credit card bills. She’s right. She is in pretty deep. So panic might be the appropriate response!

Let’s dial down the emotional volume. We’ll begin by learning about credit scoring and then offer some possible alterantives for B.

The most widely used credit scoring system today is by Fair Isaac and Co. You’ll hear it referred to as your FICO score. Fair Isaac won’t reveal the formula they use, but they will say that 35% of your score is based on payment history.

That history includes reports by lenders of late payments and partial payments. B has lots of company. According to Fitch Ratings, 4.5% of all credit card accounts are 60 days late. That’s a lot of people on the edge of panic!

There are a couple of different ways that your debt can be described on your credit report. “Paid as agreed” is the best and means that you’ve kept up your share of the agreement with the credit card company. “Paid” means that you had problems, but did pay what was owed. “Settled” means that you came to an agreement with the lender for something less than the whole amount owed. “Charged off” means that the lender was unable to collect the money owed.

What has happened so far with B? She doesn’t say specifically, but we’ll make the assumption that this started when she couldn’t afford to make her monthly payments.

At that time she should have contacted her lenders or a credit counseling. Often they can work out a payment plan that’s affordable and will prevent further damage to your credit score. Either one of two national organizations can point you to an agency. The Assoc. of Independent Consumer Credit Counseling Agencies (866-703-8787) or The National Foundation for Credit Counseling (800-388-2227)

Because B quit paying her bills the credit card companies hired a collection agency and charged off the account. That charge off shows on B’s credit report.

B has four options at this point. She can ignore the bills and make no attempt to repay or resolve the problem. Naturally her credit score will be badly damaged. She can expect to find it very difficult to borrow money for at least the next 7 years. She may also have some trouble renting an apartment or finding a job. Sometimes landlords and employers check credit scores.

The second option would be to contact a credit counseling agency. They may still be able to work out a payment plan. She would be required to pay back the amount she borrowed, but interest rates and fees would be lowered. At the end of the program her credit report would show those items as “paid.”

A third choice would be to negotiate directly with the lender or collection agency. If she pursues this any contact should be in writing. Refuse to negotiate by phone. The lender may be willing to accept less than the amount owed. In that case her credit report would show the account as “settled.”

Her final option is bankruptcy. That would discharge her debts. But, B may be required to give up her home or car to help pay creditors. Accounts included in the bankruptcy will show that way on her credit report for 10 years. But, that might not be all bad. Chances are that most of them were already late.

There are pluses for your credit score if you declare bankruptcy. Because debts are discharged in bankrupty, the amount you owe drops dramatically (another ingredient of your score).

Also, if you declare bankruptcy, your FICO score will be determined by comparing you to other people who have filed bankruptcy. That could help you to score higher.

What should B do? That will depend on how much she owes, her ability to repay it and what the lender is willing to accept. Her best bet is to start with a credit counseling agency. If they can’t work out a program B will be left to choose between negotiating with the collection agency and declaring bankruptcy.

Keep on Stretching those Dollars!
Gary

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Gary Foreman is the editor of The Dollar Stretcher.com website and various enewsletters. Visit the site for more info on charge offs.

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We’ll begin by getting a better understanding of thrift stores.

Arlene points us to the first important distinction. Some are non-profit while others are not. What’s the difference? The non-profit stores exist to raise money for a non-profit charitable organization (think Salvation Army or Goodwill). Typically the stores are owned and run by the charitable organization. Employees can be paid for their work, but many volunteer because they believe in the charity.

Because the store is a charitable operation people can donate goods and take a tax deduction for the value of their donation. So most (if not all) of the product that the non-profit thrift stores sell doesn’t cost them anything. Consequently, after paying rent and utilities, much of their sales dollars benefits the charity.

The other type of store (and presumably the kind that Arlene is contemplating) is a for profit store. In this case no charity is involved. The store is run like any other business. Profits belong to the owner and they’ll pay taxes on them.

But that also means that people won’t get a deduction for donated goods. So for profit stores have to buy much (all?) of their inventory. It also means that they labor is more expensive.

So should Arlene open a thrift store? We can’t answer that for her, but we can tell her how to answer it for herself.

Begin by setting up a business budget. Estimate what your first year expenses will be. Start with the store itself. How much will it cost to rent? How much will you spend setting up displays and outside signs. Is anything required to bring the store up to building codes? Don’t forget utilities and deposits. Insurance? Any permits or local business licenses?

Add in the labor costs. Even if Arlene is the only employee, she’ll want to pay herself (after all that is the idea here!). And, when she does, she’ll be responsible for Social Security taxes. Depending on her state she might also be on the hook for worker’s comp, other insurance or state/local taxes.

At this point Arlene will have an idea of her expenses. Next she’ll estimate how high her sales will need to be to break even. For illustration we’ll make some assumptions. Let’s say that what she buys for $1 she can sell for $4 (this is an important estimate so give it proper thought). If her expenses and salary total $40,000, she’d need to sell $53,333 worth of merchandise ($40,000 divided by the profit margin of .75 or 3 divided by 4).

Bottom line, that’s a lot of product for Arlene to sell. And, it might explain why there are so few thrift stores that are not affiliated with a charity.

But, all is not lost! There are ways for Arlene to get into the resale business with much less financial exposure.

The one most similar to opening a thrift store would be to rent space in a flea market. Instead of being responsible for a whole building, you only rent a small space within the building. That dramatically reduces expenses and increases Arlene’s chances for profitability.

A second alternative would be to hold regular garage sales. That way she has no overhead. Any mark-up on products sold goes into her pocket. One caution. Some towns have laws limiting the number of sales you can have in a year. You’ll also want to consider your neighbors.

A final alternative is to set up an online store, perhaps on eBay.com. It costs almost nothing to get started. And, it has one advantage over a ‘real’ store. The internet attracts buyers from all over. So you can specialize if you want. Many online sellers only do old books, records, vintage clothing or collectibles. Generally these items draw higher prices than most thrift store merchandise.

So what should Arlene do? Walking through the steps needed to estimate the expenses and income should give her fairly clear idea. Fortunately, it’s not an all-or-nothing proposition. She has can select the best way to get started.
Keep on Stretching those Dollars!
Gary

______________

Gary Foreman is the editor of The Dollar Stretcher.com <a href=”http://www.TheDollarStretcher.com” target=”_blank”>website</a>  and various enewsletters including Financial Independence. <a href=”http://www.stretcher.com/subscribe/subscribeFI.cfm” target=”_blank”> Financial Independence</a> is designed to walk step-by-step with you as you take control of your finances and achieve financial freedom! For more info on <a href=”http://www.stretcher.com/stories/03/03sep15a.cfm” target=”_blank”>how to start a home business</a>.

Articles on this site have been acquired from a variety of sources.  No content on this site should be considered financial or legal advice

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If this is the case then to protect you from collection agencies harassment, you need to know your rights against the collection methods. Here are those which your collection agencies are not supposed to do:

You collection agencies are never allowed to call at your work place. If they are doing then you can fight back against them.

• They are not allowed to call you before 8 a.m. or after 9 p.m. even at your home.
• They are never allowed to address you in an abrasive manner or speak to you rudely or harass you.
• Never make misleading statements that threaten you or add any unauthorised charges.
• They are not permitted to call you friends and family members and discuss your debt with them and try to collect it from them.

If you collection agencies is doing any of the above mentioned, then tell your collection agency to stop harassing you. In any circumstance if they continue to do so then make sure to take their name and address and report to better business bureau or federal trade commission or any state’s attorney office.

Before taking the complaint to legal offices, make sure to record the conversation over phone that you are making a request to collection agencies that they are acting against the law and request them to stop doing so. You can also make this request in written to collection agencies by taking their name and address. This can also help in showing a proof of your request to collection agencies. If they continue to do so even after making request then you must take the issue to legal authority that is dealing with this law.

You can know you right better by referring the fair debt collection practices act. It was instated to help the consumers who are facing financial hardship and unable to repay the debt even if they want to clear it. This law was brought into action by federal government that states they you can demand the collection agencies to stop contacting you, except to inform you that collection efforts were ended and unfruitful and the creditor will start taking against you and may sue you to court.

However you can not stop creditor calling you directly for collecting your debt because the fair debt collection practices act will not stop the direct creditor asking you to pay the debt that you owed to him. Therefore before acting make sure to know whether the direct creditor or collection agency is calling you.

Articles on this site have been acquired from a variety of sources.  No content on this site should be considered financial or legal advice

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Even if you have bad credit, you can manage to obtain credit for buying home, cars or any other asset or appliances. There are many lenders like sub prime lenders, car loan lenders out there who deal with bad credit history as a part of their business and are genuine in providing there service. But there are few lenders who involve themselves in scams and take advantage of the people with bad credit history.

For this reason you must be careful enough when dealing with lender while having bad credit history because you will have less option compared to one who maintains good credit score. Having bad credit history and applying for mortgage loan or any kind of loan meaning you are going to pay higher interest and higher fee compared to borrower with good credit ratings.

There are many mortgage lenders for borrowers in Michigan with bad credit. They are:

Countrywide home loans: this mortgage lender offers mortgage loans to all type of credit history borrowers. They have many programs to choose from.

Eileen mortgage funding Inc: with this mortgage lender in Michigan you can manage to attain best mortgage rates even if you have bad credit.

Family first mortgage: this mortgage lender in Michigan offers mortgage loans for both people with good and bad credit also.

There are different types of bad credit mortgage loans available in the mortgage markets. One is 100 percent financing option where only one lender will offer you total loan, which is very easier option for you to handle your finance. But not all lenders will offer this type of loan. The other option includes 80/20 financing, where your mortgage is financed with two loans. These two loans can be offered by one lender only. This financing option is more common but it may involve some negotiation with lenders.

You might be thinking that having bad credit, how it might be possible. This might not be possible in normal case but during the present housing market, especially in the state of Michigan, which has so many foreclosed properties, government and banks are making it easier to get mortgage loans even if you have bad credit.

For getting approved by the mortgage lenders or any other type of lender, the main thing you should be concerned about is your ability to repay the loan. Remember that any thing you borrow must be paid back with interest. One thing that may prevent you from getting the loan is federal law because it restricts the lender to lend you if you can not afford monthly repayments.

If you can afford to monthly repayments then you must prove to your lenders your monthly income there by manage to get credit and start rebuilding your credit.

Articles on this site have been acquired from a variety of sources.  No content on this site should be considered financial or legal advice

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