Do I Have Too Many Credit Cards?

Credit Cards - What Is the "Magic" Number? By Michelle Black

Have you been thumbing through your stack of credit cards lately and wondered, "do I have too many?"  This is one of the most common credit questions I receive, so I thought I would share a little bit of insight into the matter.

The answer to the "how many credit cards should I have?" question is not necessarily the same for every person. As a general rule of thumb, it is advisable to have 3-6 open credit cards on your credit report. So, I can very easily advise that if you have less than 3 credit cards, you need more.  That being said, if you have more than 6 credit cards open right now I am NOT advising that you immediately close any accounts.  It is very important to have some professional guidance when and if you decide to close existing credit card accounts.  Closing the wrong account can potentially cause your scores to drop significantly.

If you already have 3 or more open credit card accounts is much more important to focus on your credit card balances rather than the actual number of credit card accounts you have.  Did you know that if you have a credit card with a balance that is over 50% of your credit limit then your credit scores will be lowered even if you are paying your bill on time every month?!?! This means that if you have a credit card with a $500 limit and you charge more than $250 on the card then your credit scores are affected negatively.  Your best bet is to keep all of your credit cards paid off to a zero balance.  (HOPE members have access to our "Snow Ball Effect" debt pay off plan to help begin eliminating credit card balances during their membership.)  By keeping your credit card balances at zero you also get to avoid paying those pesky interest fees and, therefore, save yourself some money!

Another fact about your credit card accounts that you should be aware of is how extremely important it is to make sure that your credit card is paid on time every single month.  Since 35% of our credit score is determined by our payment history it is easy to see how one single late payment can cause a huge drop in our scores.  In fact, I have seen a credit score drop as much as 100 points due to a single late payment on a credit card account!  Keeping your credit card balances at zero gives you further insurance against late payments as well.

We at HOPE would like to thank those of you who participated in our Facebook credit poll last week which asked the question "How many credit cards should I have open?" If you are not already a fan of our HOPE Facebook page we want to invite you to follow us on Facebook and/or Twitter for access to HOPE's latest credit tips, special offers, and giveaways! Congratulations to Jill Lowe who won our credit poll contest last week and will be receiving a free professional credit analysis with a HOPE credit specialist!

If you have questions or need credit related advice, please feel free to give us a call at 704-499-9696.  Our friendly staff is waiting to hear from you and will be happy to help.

Spring Cleaning for Your Finances

I recently read a very good article by Dave Ramsey that I would like to share with you: "Spring is in the air.

The birds are chirping, the flowers are blooming, and the temperatures are warming. Who doesn't love this time of year? Not only does spring remind us of the beauty of the outdoors, but it also reminds us to get our homes organized—in other words, to do a little spring cleaning.

This year, though, while you are cleaning the garage, shampooing the carpet, and organizing the closets, we suggest that you do a little spring cleaning in another area of your life—your money. Regardless of what baby step you are on and where you are on your journey to financial peace, you've got to stay organized to win with money.

So what exactly does a financial spring cleaning look like? We have some suggestions:

Clean out file drawers

Do you really still need that cable bill from August 1999? Seriously? You need to keep old bills, bank statements, tax documents, and other important papers for varying lengths of time. But utility bills, sales receipts for minor purchases, and ATM and bank deposit slips can be shredded after a few months.

Prune unnecessary expenses

Are you really getting your money's worth with that gym membership? Do you really need 250 cable channels? Is it necessary to have a landline and a cell phone? While you're organizing your file drawer this spring, take an in-depth look at your finances and see where you can cut back costs. This is especially important—and should be a top priority—if you are still working your way out of debt.

Update important documents

When was the last time you checked your car insurance? Your home insurance? Tax withholdings? Your will, 401(k) or Roth IRA? If it's been awhile, then now is the time to make sure you have all the coverages and investments you need. What made sense two years ago might not work for you today. In the middle of all this spring cleaning, make sure you are protecting yourself, your family and your future!

Spring is a great time to get re-energized and refocused on your financial situation before summer and all its distractions get here. The small amount of time you spend now getting your financial house in order will pay off for you in the long run."

Feature HOPE Credit Experts at Your Next Event

Credit Experts....At Your Service!

We are currently scheduling speaking engagements for HOPE director and leading credit expert, Ron Lambright, and there is still time for you to get involved! Ron and our HOPE staff specialize in credit related seminars which are sure to enhance your next staff meeting, church event, home buyers training session, etc. Seminars can be customized in length to meet your specific time needs and seminar topics include:

*Credit Myths Exposed! *Credit Basics *Budgeting Bootcamp *How to Read a Credit Report *And much, much more!

Our HOPE staff has 35 years of combined experience in the field of credit education!  We would be thrilled to share our expertise with your group at your next event.  Please call 704-499-9696 today to reserve a spot on our calendar. Ron has been traveling nationwide holding these exciting credit seminars, so available times are going fast! We hope to hear from you soon.

When Collection Agencies Attack

When Collection Agencies Attack!How to Protect Yourself from Harassment

It is 10:00 pm, you are getting ready for bed after a long day of work, dinner, homework, and finally getting the kids to sleep.  The phone rings, you answer, and the voice you hear on the other line immediately causes your blood pressure to spike and your pulse to race.

Does this story sound familiar? For many Americans calls from collection agencies and creditors is an all too familiar burden.  With unemployment rates soaring, the current state of the economy, and the rising expense of every day living you may find yourself in the uncomfortable and very stressful situation of being unable to make ends meet.  However, just because you cannot afford to pay your past collection debt right now does not mean that you have to endure these harassing phone calls.  You still have the right to be treated with respect!

The good news is that the Federal Trade Commission, most States, and the Fair Debt Collection Act (FDCA) can all help to protect you from collection agency/creditor harassment.  The FDCA has very clear rules which regulate what debt collectors can and cannot do. For example, according to the FDCA, a creditor cannot:

1.  Threaten violence or threaten to harm you and/or your family in any way. 2.  Use obscene/profane language. 3.  Repeatedly use the telephone to annoy a consumer. 4.  Make false statements such as -falsely claiming they are attorneys or government representatives -falsely claim that you have committed a crime -misrepresent the amount you owe 5.  Say that you will be arrested if you do not pay your debt. -Note: There is no debtor’s prison in the United States! 6.  Call your employer. 7.  Call you before 8:00 AM or after 9:00 PM.

So, what is the secret to stopping collection calls?  There are actually several options available to you.  Here are a few:

1.  Negotiate and settle the debt. -Once an account is paid the collection calls will, generally, stop.  However, it is very, very important to have a debt negotiations specialist (like HOPE) assist you while settling your old debt to insure that you receive the lowest settlement possible, to be sure that your credit report is updated properly to show a zero balance on your settled account, and to hold the creditor responsible to keeping his/her word and not changing the settlement terms in the middle of your negotiations process.

2.  Request for the calls to stop.

-If you simply are not financially ready or able to settle out your old debt at this time you still have rights! Many times simply mentioning the Fair Debt Collection Act will stop a creditor’s calls. Also, when a creditor calls you can:

a. Ask the caller to identify themselves. b. Ask him/her to provide you with their agency’s address. c. Send a certified letter to the agency asking them to stop calling.

Now, it is important to remember that while you can legally stop collection phone calls, just because the calls stop does not mean that you no longer owe the debt.  Whenever you are ready to deal with your past debt and begin working to restore your credit scores we invite you to give HOPE a call.  Our caring credit specialists can provide you with a detailed analysis of your current credit report, show you how the HOPE Program can help you to address any negative accounts on your report and work to help you achieve the healthy credit scores you desire to have.

There is truly no such thing as a hopeless situation!  HOPE has helped clients with as many as 86 collection accounts and hundreds of thousands of dollars in debt to turn their credit situation around and become homeowners!  In fact, HOPE has had over 70 graduates in the past 4 months to complete our program with credit scores healthy enough to purchase a home!  If you would like to schedule a personal credit analysis, or just learn more about the awesome membership benefits offered through HOPE, please give us a call today at 704-499-9696.  We can’t wait to hear from you!

Your Tax Refund Could Equal Healthy Credit If Invested Wisely!

Every year at tax refund time we have many clients wisely choose to  invest part of their tax refund check towards achieving a healthy credit report. Wouldn't you love for 2011 to be the year when you finally reach the higher credit scores you desire? Wouldn't it be wonderful if 2011 was the year when you were finally able to stop those pesky collection calls and possibly even become a homeowner? HOPE would love the opportunity to help you reach your goals! You can join the ranks of the 70+ HOPE graduates who have completed the program with credit scores healthy enough to purchase a home in just the last 4 months! Call or email us today to schedule your own personal, no obligation credit analysis with one of our credit experts to see if the HOPE Program is right for you. We can't wait to hear from you soon!