False advertising: There is no “federal debt relief plan” for consumers
April 27, 2009
If you get an offer in the mail of a “federal debt relief” plan, throw it away.
Consumers are receiving a mailing — with a return address of
WTAE News in
You can read and see a video of that story here.
As of now, there is no federal debt relief plan for consumers facing credit card debt.
Anyone who struggling with debt should contact a non-profit credit counseling agency that is affiliated with the National Foundation for Credit Counseling and is in good standing with the Better Business Bureau.
Avoid any company that initiates contact with you, charges large upfront fees and is not a non-profit.
Don’t buy a home just for the tax credit
April 23, 2009
I was trolling the MSN Money Message Boards when I came upon a thread started by a couple that is considering purchasing their first home.
The biggest reason that I could glean from the post that they wanted to buy right now was to get the first-time homebuyer’s tax credit. Let’s face is $8,000 is an enticing sum of money.
However, it didn’t seem to me that the poster was being realistic about their situation.
The main problem was that both the husband and wife had very low credit scores, all three scores for both of them are below 600. Every situation is different, but the likelihood that a lender will give them a home loan isn’t very good right now. And if they do find a willing lender, the interest rate is going to be sky high.
Some posters suggested they look for an FHA (Federal Housing Administration) loan. While it is true that the FHA lending standards are different from going through a bank, even the FHA is going to take a hard look at their credit scores and financial situation. If you are applying for a government-backed home loan and your credit score is 660 or below, the government requires that you go through a housing counseling session with a HUD-approved (U.S. Department of Housing and Urban Development) counseling agency.
Advantage CCS is HUD-approved and offers these counseling sessions, known as “pre-closing counseling.”
I am worried that the new tax credit is causing people to lose perspective. It is a wonderful incentive for people who have strong credit scores and a decent down payment. It was meant to spur people to buy who are in the financial position to buy. It is not a good idea for someone who is not in the right financial position to buy a house just to get the tax credit.
If you get a home loan with a very high interest rate, there’s a good chance you will spend far more in interest payments than you would gain through the tax credit. And you can’t count on being able to refinance quickly. You could be stuck with that high interest for a long time.
If you are considering buying a home for the first time, call Advantage CCS to set up a counseling session to discuss your financial situation. A certified counselor will be able to help you determine if you are in a good position to buy a home. If you’re not financially ready to buy, the counselor can help you create a plan so that you will be able to buy a home in the future.
Shop slowly, save money
April 16, 2009
Some people are staying out of restaurants and making an effort to prepare more meals at home to save money.
I think there are many benefits to eating at home besides the cost savings. (Though, if I’m completely honest, my husband and I end up eating out more than we should.)
Of course if you’re going to cook at home that means you need to go do some grocery shopping. It turns out — according to an opinion piece in the New York Times — that many shoppers are making costly errors when they head to the grocery store, and one is not the error that you might expect.
I always knew that going grocery shopping without a list was a recipe for a supermarket disaster. The best way to save money is to make sure you only buy what you need and also to plan meals ahead based on what items are on sale or in season. Having a list keeps you on task and saves money if can stop your hands from wandering towards things you really don’t need.
I always thought that shopping in a hurry was a big no-no. Apparently shopping slowly is what can really throw you off.
The writer of the New York Time’s piece, Kate Stein, worked last summer as a researcher for the Cornell University Food and Brand Lab. Her task was to observe the habits of thousands of shoppers at a variety of different grocery stores. What the research uncovered was that the shoppers who spent a long time mulling their purchases were the shoppers more likely to stray and buy items that were unnecessary and/or unhealthy.
The piece didn’t offer any reasoning behind this. I would like to see some more information about the study, because I think it’s very interesting. My theory is that the longer you take to shop, the more chance you have to notice unnecessary products in the store. If you are moving quickly, you’ll be focused on getting only what’s on your list and getting out.
So, if you want to manage your time, keep your costs down and your food healthier, make the list and get through it quickly.
Watch out for text message scam
April 14, 2009
It’s time for another scam alert …
Someone has hatched a plot to get your banking information by sending out text messages. WPXI carried a story this morning that people in the
The texts that WPXI reported on were supposedly from Citizens Bank, though the text could come from someone claiming to represent other banks as well.
If you get one of these texts, please do not respond. Let your bank know you received the text and take note of any important information that may be available, such as the number that sent the text.
Your bank will never text message you asking for information about your account.
Don’t skip insurance coverage to save money
April 9, 2009
When times get tough financially, it’s time to cut back on your expenses.
There are plenty of things we can live without, but there are also some things we shouldn’t try to live without.
Insurance, in my opinion, is not something that should be cut from the budget.
A story on MSNBC said according to the insurance industry, 1 in 6 drivers likely won’t be insured by the end of the year.
That is a scary figure.
Experts are warning that there may eventually be record numbers of uninsured drivers on our roadways.
Again, that’s scary.
First of all, almost every single state, including
Furthermore, if you are in an accident, how will you pay for the repairs? What if you or another party involved in the accident is injured? You could open yourself up to a lawsuit that could cost you far more in the long run than the money you’ll save by skipping the insurance.
If you think your insurance payments are too high, sit down and review your policy. Years ago I thought my premiums seemed high. I was right. After I review of my policy I found out I was over insured. Make sure you have an appropriate level of coverage.
Auto insurance isn’t the only insurance you should have. If you are a renter, you should carry renter’s insurance. If you don’t, you need to realize that in the event of a disaster, you could lose everything you have.
Most property owners have insurance on their building, but they do not cover the personal belongings of the renter. When I was a newspaper reporter, I covered many fires where renters lost all of their possessions and didn’t have renter’s insurance to make them whole again.
Imagine the cost of replacing everything you own out of pocket.
Likewise, homeowner’s insurance not only covers the contents of your home, it can also protect you from liability should someone get injured on your property.
I know insurance seems like a needless expense. And people who pay into insurance for years and never have to use it probably feel like they’ve thrown all of their money out the window. But it’s still better to be prepared.
Several times my cars have been damaged in accidents that were no fault of my own. In one situation I was responsible for an accident. If I, and/or the party that caused the damage, had not been insured, the out-of-pocket expenses for repairs would have been astronomical. In those cases insurance is a relief and an expense that is well worth it.
- SEARCH:
