Five Important Steps to Buying Your First Home

With the First Time Home Buyer Tax Credit extended, more and more people are looking to buy a home right now. However, owning a home is not something you want to rush into, and you need to know what you're getting into and how to approach it in order to make a responsible decision.

The key to the entire process is to ask questions. Lots and lots of questions. And, there is NO STUPID QUESTION.

Here are 5 important steps to buying your first home:

1. Get your Finances in order - Check your credit score, taxes and all other aspects of your finances to figure out the max you can afford with monthly mortgages, utilities, taxes, maintenance and insurance. A bad credit score can affect what rates you sign on a mortgage...or prevent you from getting one altogether.

It helps to go ahead and get pre-approved by a lender. That lets the seller know financing is already lined up.

2. Find a Realtor and start looking - Often the best way to choose a realtor is through a referral from a friend or family member. Make sure they have experience with the area you're interested in and are good negotiators. Make a list of pros and cons of things you must have in a house and prioritize it. Consider location and convenience to church or shopping or schools.

3. Investigate the reputations of builders & condos - Check out their financial health and get info from the Better Business Bureau.

4. Make an offer and apply for a mortgage - Buyers are generally in the driver's seat these days. Have enough cash for a down payment, which can be a minimum of 10% and extra funds for closing costs, sppraisals and move-in deposit. Definitely do an inspection.

5. Prepare for closing - Secure homeowners insurance. Have a financing contingency to get you out of your contract without penalty if your loan doesn't go through. Have certified funds ready, a cashier's check instead of a regular check.

Buying a home is a wonderful milestone, but also a big responsibility. Do your research and prepare in advance. Most our clients are going through this process and cleaning up their credit in advance. United Credit Source wants to help you through the important times in your life and prepare you for your future!

5 key steps to buying your first home, tax credit or no.

The Ingredients of a FICO Score

FICO is an independent company from the 3 credit bureaus, TransUnion, Experian & Equifax.

They developed the algorithm that 90% of the largest banks in the United States use.

Your FICO score is used to determin mortgage rates, car rates and credit car terms.

The FICO credit scores range from 350-850. Scores below 600 are considered high risk borrowers. 690 and above is considered excellent. How are the scores decided? They are based on your payment history, outstanding debts, credit history, new credit & credit in use on your credit report.

Here's how it's broken down:

35% of your score is calculated from your payment history. Paying on time makes a big difference!

30% is based on the amount of debt your carrying currently. Paying balances down can make a big difference!

15% is based on the length of your payment history. The longer you've been around, the better. If you're new, you can be risky.

10% is based on any recent inquiries. Don't go around having your credit pulled by every auto dealer, credit card company out there. It adds up.

10% is based on your credit mix variation. It's good to have different kinds of credit, such a credit card, a car payment and a student loan.

Now, we still don't know FICO's secret algorithm, but we have an idea of the ingredients.

Pay attention to all aspects of your credit.

Pull a consumer credit report regularly without any affect to your scores,

and United Credit Source can help you clean up any inaccurate or deliquent info on your credit report.

Take control of your financial future!

Budgeting on an Irregular Income

Creating a Budget when you have an irregular income can be intimidating, but you still need to do it. You'll feel so much better about your finances if you take the time to plan things out and take control of what you can.

First you need to figure out exactly how much money you need each month to get by. The basics. This includes food, utilities, your home and transportation. This does not include entertainment and extras.

Then you need to list items in order of importance. The most important first, the next important, and so forth. Dave Ramsey, the financial guru, has several budgeting forms you can download for free to help with this process.

When you receive your paycheck, spread this money out through your budget, starting with the first item and working your way down the list. It may not cover everything, but just try to pay as much as possible. Then, when your next paycheck arrives, continue on the list from where you left off, paying bills.

It might take a little trial and error to figure it out and make it work well, but it's worth figuring it out and taking control of your finances. United Credit Source wants to help you achieve financial control. We'll help you figure out which debt to pay down, how to take control of your credit scores and clean up those negative, inaccurate accounts on your credit report. We will educate you so that you won't find yourself trapped by your finances.

Twitter Tracking

It's a unique method of tracking your purchases.

Debit cards and credit cards report in monthly statements what you've spent your money on.

Cash you can only keep track of if you save all your receipts...and that can be a pain and much more difficult than it sounds.

Introducing Twitter. And Text Messaging.

For those of you out there with smart phones, this is easy as pie. After making a purchase with cash only, send yourself a direct message over Twitter to make a record of the transaction. Or send yourself a text message. It's quick, it's easy, it's private, and later you can consolidate all your spending that you might forget by the end of the day...or have lost receipts for.

There's no need to do this all the time.

But when you're trying to hold yourself accountable for your spending and trying to figure out where all that money goes...this helps.

Identify the categories you tend to overspend in, and then work on that budget!!

Little tools like this can help a lot, if you use them!

United Credit Source goes out of its way to find ways to help you manage your money.

Let us help you!

We're most than just credit repair.

We're your financial watchdog and mentor.

5 Reasons Why You Might Want Good Credit

Having a bad credit score closes many doors, whereas good credit helps with more than just getting a credit card or a loan. Here are some big reasons why it's important to have good credit.

1. Shelter - Mortgage Lenders will either deny you a loan to buy a home...or approve you, but with a higher cost. If you're not interested in buying, you need to know that credit is used for rental decisions as well. Landlords can deny your lease if you're a risky choice.

2. Transportation - You need a loan to get a car. What interest rate you qualify for is directly dependent on your credit.

3. Employment - Potential employers run credit checks during hiring oftentimes. If you have too much debt, you might not be a good candidate for the salary offered.

4. Business - If you have dreams of starting your own business, you usually need to be approved for a loan to get the start up cots covered.

5. Utilities - Electric, cable, telephone, water and cell phone companies do check to see if you have a good credit history. Have you been responsible paying utilities in your past?

You can run, but you can't hide from your past credit history. Go ahead and start making changes now, so that when the times comes, you can qualify for what you need. United Credit Source can help you understand your credit report and help you make the decision how to proceed in your best interests. Don't despair, we'll guide you through this second chance.

The Credit Card Trap

Credit cards can work for you, or against you.

If you're sick of credit cards or have been treated badly by a credit card company, you're likely to want to close that account. While that may seem like the best answer, it's really not. Because closing a line of credit lowers your credit score, which in turn can make it more difficult to get a loan or new credit card.

You could pay the balance and just stop using the card. That way the open line of credit works in your favor without any debt piling on. However, some credit card companies are adding annual fees and inactivity fees, which can ruin that plan.

What it comes down to is knowing your credit to debt ratio. How much outstanding debt do you have in relation to the amount of available credit? The more debt you have, the lower your credit scores, the more risky you appear to other lenders. In the wake of the credit crisis, lenders are paying more attention to credit scores than ever.

Feel like you don't understand what's going on? Need someone to help explain your credit report? United Credit Source helps with all of that. We're walk you through the credit repair process, talk you through understanding your credit report, and help you figure out the best strategy for your credit profile, depending on your goals.

Money & Your Marriage

Money problems are one of the largest reasons couples split up or divorce.

When you or your spouse is in a rough spot over money, communication is the key. It's really hard to admit you've made a mistake or that big changes need to be made. But if you wait too long, matters can spiral out of control.

Turn off the TV, step away from the computer, put down your phone, and sit down and talk with your significant over. Put everything out there. Be completely open and honest. Only together can you truly work to solve a problem.

A hugely helpful tool to solving money isues is to make up a budget. Yes, the B word. It doesn't have to be huge and scary. You can use an online budgeting tool to help you or just grab a piece of paper and write down how much you earn in a month. Then write down every expense you have, including bills, groceries, clothing, insurance, credit & debt,etc. Once you see how much money is coming in versus how much money is going out...well, adjustments will need to be made. But you can do it, and you can do it together.

Get your financial situation under control before it gets too large and out of control...

and before it hurts your marriage irrevocably.

Loan Modifications

Starting June 1, 2010, home owners applying for mortgage modifications will have to provide paperwork upfront to prove they qualify. They will need the following documentation:

1. Two pay stubs

2. An electronic form that allows a servicer to pull up a tax return online

3. A request for modification that includes a hardship affidavit.

The goal of this new process is to decrease time delays and increase the success rate of turning trial modifications into permanent modifications. Around 66,000 homeowners have accepted offers to change from trials to permanent modification programs.

This new program applies to borrowers who live in their homes and whose housing debt expenses are more than 31% of their income. Simplfying the process should make things easier overall.

Under modifications, intrest rates are reduced, then terms of the loan are extended. Homeowners usually have to complete the trial of three months of making payments on time, and then they can enter the permanent phase.

United Credit Source can help you clean up your credit report and help you better qualify for programs like this.

Do you know your rights?

The Fair Credit Reporting Actwas passed in the United States originally in 1970 to regulate collection, distribution, and use of consumer credit information. It is enforced by the US Federal Trade Commission.






Under this act, credit bureaus, such as Experian, Equifax and Transunion, have certain responsibilities:






1. They must provide a consumer with the information about him or her in their files and verify the accuracy of that info.




2. Negative info that has been disputed and removed may not be reinserted without notifying the consumer in writing within five days.




3. The Credit Bureaus may not keep negative info for an excessive period, such as more than seven years for late payments, collections or judgments. The only exceptions are bankruptcies (10 years) and tax liens (seven years from when they were paid).




Also under this act, information furnishers, such as credit card companies, collection agencies, auto financers or mortgage lenders, may only report to a consumer's credit as long as:




1. They provide complete and accurate information.




2. They must investigate disputed info and must respond within 30 days of notice of a dispute.




3. They must inform consumers of negative info that has been or is about to be placed on their credit report within 30 days.






It's important to be proactive in your own life and credit. Let United Credit Source educate you in the restoration process on how credit works as well as gaining a better understanding of your rights. We want to help you regain control of your finances, so that you can live the best quality life there is to offer.

More Bad news About Americans' Debt

Posted originally at Walletpop.com

Jan 5th 2010 by Martha C. White

For a while, it looked as if Americans were getting a better grip on their out-of-control credit card habits. Unfortunately, new data shows that we seem to be falling off the wagon once again.

According to this article in the Wall Street Journal, the rate of credit card charge-offs rose in November from 10% to 10.6% after declining for the past two months, and delinquencies continued a four-month rise, hitting 6.2% in November. Delinquencies are payments that are 30 days or more past due. Charge-offs are balances that the card company writes off as a loss and gives up on (generally, they sell the debt for pennies on the dollar to a third-party debt collector).

Moody's predicts that the charge-off rate will continue rising and eventually peak in the middle of this year. In other words, it's going to get worse before it gets better.

Even more worrisome is data that shows Americans are paying down less of their collective principal than they were just recently. The payment rate fell nearly a full percentage point in November to 16.42%.

This is bad news for delinquent cardholders individually; it's also bad for the economy as a whole. While experts have recently mentioned some encouraging signs like lower unemployment claim filings and small growth in the manufacturing sector, this recovery still has a long way to go.

High rates of unpaid credit card debt affect both consumer spending ability and consumer confidence. Both of these, in turn, directly affect the unemployment rate, since companies won't hire people to make goods or staff stores if they perceive that spending is under siege.

If this sounds like a vicious cycle, it is. While we here at Walletpop hear on a regular basis from readers who have sworn off credit card balances and stick to buying only what they can pay for at the time, there are obviously many Americans still stuck in a downward spiral of debt. Until enough people can get out from under those crushing bills, this debt is going to drag on the nation's economic recovery.

The Ins and Outs of Debt Collection

Do you know your rights?

The Fair Debt Collection Practices Act of 1977 regulates debt collection companies and how they can contact you about unpaid debts and your rights in the process.

Debt collectors cannot contact consumers at inconvenient times, such as before 8am or after 9pm, unless you give them permission.

If debt collectors contact you about a bill you don't think is yours, you can send them a letter asking for written verification that debt is yours. You have 30 days from the time you are contacted to write them.

If you ignore a debt, it you could ultimately find yourself in litigation to enforce collection should the debt be sizable . In Texas, although there is no wage garnishment, your credit scores can lower and you can be denied new credit. That's the whole point of the credit rating system is to give lenders a risk assessment and let them know how you've handled previous credit.

Some states have laws that license and govern debt collection practices. You can check your state attorney general's office to find out the laws in your state.

The Fair Debt Collection Practices Act prohibits harassing, abusive or profane telephone calls. Under this federal law, no one is allowed to threaten to take your home or have you arrested for not paying a bill. They cannot leave voice mail messages on your home phone with details about your debt or call your job and/or relatives and friends about unpaid bills.

You have every right to negotiate a settlement on a debt you owe. You can do this yourself, but be smart about it, getting everything in writing first. It's a good idea to go through a professional, trustworthy, debt settlement company, such as Elite Debt Management, to protect your interests. Your credit report can still report negatively, and there can be federal tax issues to deal with, so find out all you can before doing this on your own.

Filing for bankruptcy does cease all further collection calls and letters, but it's a major step that will negatively impact your credit report for seven to ten years or longer.

Knowing your rights enables you to handle your debts in the best possible manner. United Credit Source has a Credit Specialist Team on hand to answer your questions and give you advice. We want to help you obtain a better financial lifestyle.

United Credit Source

FINANCIAL PRIMER FOR 2010

Let's face the hard facts. 2009 has not been a banner year. In many respects, it has been the year that should not have been. One of the better aspects of 2009 is the wake-up call we all received: It can happen to any of us at any time. None of are immune unless we are prepared. Now that we're awake, let's pay attention. Some of the lessons gleaned from 2009 can provide our outlook into 2010 and beyond. Our maxim should be the same as the Boy Scout motto: "BE PREPARED." Will it be easy? I very much doubt it. But it could be the only thing to save us when the next hammer falls. How do we prepare, you ask? Let's look at some time tested methods that really work. Here they are:

Examine your goals -
What do you want to accomplish and in what timeframe? Financial issues are, at root, decisions about what is important to us and what is not. How we choose to spend our money should reflect matters which are important to our well being and our future, not whim, or fancy, or things to boost our ego. It's always better to be safe than sorry.

Take control - Set up a spending plan or budget -
Develop a plan. Housing, utilities, food and clothing, transportation, medical expense, and monthly bills, should take the priority positions. Discretionary spending should be at the bottom on the list. It is extremely important to make sure our bills get paid on time.

Increase Savings -
Spend less than you earn and put money aside for the rainy day that will eventually come. Wow, what a concept. I can still my mom and dad's voices reverberating around the inside of my head on this one. This is a great place to put your discretionary spending allowance until you have three (3) to six (6) months living expenses set aside as your reserve.

Pay down debt -
With the credit card rules and the banking industry rush to make as many changes to interest rates it is imperative to reduce debt is all areas of your life. Credit card issuers are raising rates, instituting fees, and reducing credit limits. You cannot afford to max out your credit. It will have a serious impact on your credit score and could leave you without the credit line you thought you had. Credit cards can provide an element of security in bad times, but debt itself is inherently destructive. You will never know true freedom without calling a halt to deficit spending. The more debt you have the less options and leverage you have in case of emergencies.

Develop an emergency plan -
Jobs, and income, can end at any time. Plan for how you will eliminate expenses that allow you to continue to make payment on the basic necessities of life while acquiring your next income opportunity.

Be honest with yourself and family -
If you have been impacted by the recession, admit it and quite trying to live like it passed you by, because you will continue to add debt and considerable stress to your lives. Financial matters are the mumber one (1) cause of family strife.

Focus on the long term -
Don't be short sighted. People can get caught up in the hype and react instead of responding to changing conditions. If you have a long term plan, it should serve you well in good times as well difficult times when they come.

United Credit Source

The Big Bad Wolf of Credit Cards

In The World of Credit There Are Many Predators… And Then There Is "FIRST PREMIER BANKCARD"

First Premier Bank in South Dakota has come out of the closet with a big-time credit card offer for anyone crazy enough to take it - a whopping 79.9% APR (annual percentage [interest] rate. The October, 2009 story unfolded in California when resident Gordon Hageman received an unsolicited credit card offer from First Premier Bank. When he discovered the 79.9% interest rate he quite naturally thought it was a mistake, a misprint. So he called the bank. He was shocked to find out the 79.9 % interest rate was indeed correct. It seems the state of South Dakota repealed the states usury law in 1981 in order to attract Citicorp to their state. Here is the South Dakota State Law on interest charges:

§ 54-3-1.1. Rate of interest set by written agreement--No maximum or usury restriction. Unless a maximum interest rate or charge is specifically established elsewhere in the code, there is no maximum interest rate or charge, or usury rate restriction between or among persons, corporations, limited liability companies, estates, fiduciaries, associations, or any other entities if they establish the interest rate or charge by written agreement. A written agreement includes the contract created by § 54-11-9.

Well, it certainly seems to have worked for First Premier Bank. Instead of taking things to the next level, they chose to go right off the chart. One has to ask the question "why would they do this?" And the answer is obviously "because we can." Greed, apparently has a new king.

I have said this many times before, and it bears repeating, especially now: Credit card companies are not in the business to help consumers; they are in the business to enslave the consumer while enriching themselves. In the world we live in we may need credit from time to time, but we really don't need credit cards. The borrower is slave to the lender and they have made it very easy to enter into servitude. If we refused to use credit cards and operate on cash only, then the credit card industry would either crash and burn or they would be kissing our feet and begging for our business with consumer friendly interest rates, maybe even interest rate wars. Personally , I don't see the latter ever happening, so I vote for crash and burn.

Read Mr. Hageman's entertaining story here:

http://www.americanbankingnews.com/2009/10/15/first-premier-bankcard-offers-customer-79-9-apr-credit-card/

United Credit Source

Tom Johnson

Consumer Wins Home in Foreclosure Proceeding

It may not happen every day but when it does it is a GREAT DAY. Just ask Diane Yano-Horoski and her husband, Greg Horoski. Instead of being kicked out on the street by their mortgage servicing company the judge awarded their home to them free and clear.

Morale of the story: it pays to fight for right. Read the entire story here: http://www.nypost.com/p/news/local/judge_kos_mortgage_to_slap_bank_28ZS1oW8Y58z6gu1AQbWMI#

United Credit Source

CitiBank To The "Rescue"

CitiBank Strikes Again

Most consumers are aware that the credit card vendors are raising their rates, lowering limits, enacting fees, and just outright closing accounts of their card holders before the new law comes into effect in Feb. 2010. Credit card holders must always remember that the credit card vendor will never look out for your interests; only their own. You are their meal ticket and they want you fattened up. This is all about making money off of (or taking from) the consumer and enriching the banks.

Now comes CitiBank with their latest attempt to appear as the white hat good guys riding in on their white horses to offer the card holder a way to reduce their interest rates. By using circular logic they offer you a reduction of the interest rate (that they just jacked up) if you regularly spend more. (I smell a trap at the pass awaiting all who enter there.)

Please read the linked article below and be aware that this is probably just the first of many more schemes and gimmick offerings by the credit card industry to get deeper into your pocket and keep their hand in there longer.

I don't know if I should recommend you take aspirin or oxygen as you read this. But I will say this: BEWARE - THE CONTENT OF THIS ARTICLE COULD BE VERY HARMFUL TO YOUR FINANCIAL HEALTH.

http://www.thestreet.com/story/10630251/1/citigroup-gets-creative-to-boost-cards.html

United Credit Source

Foreclosures Hitting More People With Good Credit

WASHINGTON - 11/19/09

The foreclosure crisis likely will persist well into next year as high unemployment pushes more people out of homes, pulls down housing prices and raises concerns about the broader economic recovery. The latest evidence was a report Thursday that a rising proportion of fixed-rate home loans made to people with good credit are sinking into foreclosure. That's a shift from last year, when riskier subprime loans drove the housing crisis.

The report from the Mortgage Bankers Association also found that 14 percent of homeowners with a mortgage were either behind on payments or in foreclosure at the end of September. It was a record-high figure for the ninth straight quarter. The data suggest the housing market and the broader recovery will remain under pressure from the surge in home-loan defaults, especially as unemployment keeps rising. Lost jobs are the main reason homeowners are falling behind on their mortgages.


After three years of plunging prices, the housing market started to rebound this summer. That lifted hopes for the overall economy. But analysts say there are too many foreclosed homes that have yet to be dumped on the market and expect further price declines.

Among states, the worst damage is still concentrated in the states hardest hit from the start: Florida, Nevada, California and Arizona. Together, they accounted for 43 percent of new foreclosures. One in four mortgages in Florida were either past due or in foreclosure, the most in the U.S. Nevada was close behind at 23 percent.


"There's no indication in this data that foreclosures are going to abate anytime soon," said Mark Zandi, chief economist at Moody's Economy.com, who projects that nationwide home prices will fall up to 10 percent before bottoming next fall.

Driven by rising unemployment, prime fixed-rate loans to borrowers with good credit accounted for nearly 33 percent of new foreclosures last quarter. That compares with 21 percent a year ago. Many laid-off homeowners might be able to survive on their savings for a while, but "the longer the economic situation stays in place, the less likely they are to hold on," said Jay Brinkmann, chief economist at the Mortgage Bankers Association. In markets where foreclosures already are high and still rising, prices likely will remain soft. That will cause developers to keep their bulldozers idle and prevent the industry from making a big contribution to the economy's recovery. "Builders only start homes when they can make money," said John Burns, an Irvine, Calif.-based real estate consultant. "In a lot of areas, until prices go back up, construction doesn't make any sense."

The crisis has struck people like Betty Wilson of San Diego. She was laid off a year ago from her job at an insurance company. Since then, Wilson has managed to pay her $1,090 mortgage bill from collecting unemployment benefits, renting out a room and dipping into savings. But money is running low. She fears she won't make her payment for December. Wilson, 56, said she has tried to get her mortgage company, GMAC Mortgage, to lower her 6.25 percent interest rate or give her a temporary break from payments. Many mortgage companies will let a borrower skip up to six months of payments, though they require that the money be paid back eventually. After The Associated Press inquired about her case, a GMAC spokeswoman said Thursday that the company would offer Wilson reduced payments for four months, "while we continue to review her financials for a permanent solution."

After a typical recession, foreclosures peak about six months after the unemployment rate does. But the process could take longer this time, in part because loan-modification programs and new state laws have prolonged the process. Unemployment, now at 10.2 percent, isn't expected to peak until next spring or summer. Another unknown is the effectiveness of the Obama administration plan to attack the foreclosure crisis. As of last month, about 20 percent of eligible borrowers, or more than 650,000 people, had signed up. But most of those enrolled have been chosen for trials lasting up to five months. About 4 million homeowners were either in foreclosure or at least three months behind on their mortgage payments as of September, according to the mortgage bankers group. Even if some of them manage to stay in their homes, the market is likely to absorb a wave of new foreclosures. Those properties are concentrated in states like Florida and other already beleaguered areas.

Subprime loans with adjustable rates have fallen to 16 percent of new foreclosures, from 35 percent a year earlier. Loans backed by the Federal Housing Administration also show rising signs of trouble. More than 18 percent of FHA borrowers are at least one payment behind or in foreclosure.


The Mortgage Bankers Association's quarterly survey of 44.6 million loans is considered the most authoritative report on mortgage delinquencies. A separate report, issued monthly by foreclosure listing service RealtyTrac Inc., is based on courthouse filings.

By ALAN ZIBEL, AP Real Estate Writer - 11/19/09


More articles from ALAN ZIBEL - http://ap-127553.newsvine.com/

United Credit Source

Stop Payment Checks Can Come Back To Bite You

STOP PAYMENT ORDERS ON CHECKS DON'T ALWAYS WORK

A Watauga, Texas couple wrote a check and stopped payment on it at their bank the next day. Six months and six days later their bank, Washington Mutual, cashed the check for a customer who presented the check for payment. The couple was out $1,350.00 and the bank refuses to help. I did some research after I read this story. It turns out that the current standard banking practice allows banks to place a date limit on stop payment requests. There is no hard specific rule on how long a stop payment order is in place. Banks are free to make up their own policies in this matter.

Most banks now have a 6 month limit on stop payment orders. In order to continue a stop payment order, you must renew your stop payment request every six months, paying a substantial fee each time you renew. This seems completely outrageous, but it has apparently become a standard banking practice.

Further, if a check comes in to your bank that is dated more than six months old, at their discretion, your bank can decide whether it wants to pay the check or bounce it based on the old date. This also seems ridiculous but appears to be standard banking practice.

I checked these rules with my bank. They told me their policy was essentially the same as what I outlined above. After six months, a stop payment order expires. If a check comes in older than six months, they usually don't bother to check the date and process it anyway. Most checks are processed in bulk, and therefore they do not see the dates on the checks unless presented in person. If there are insufficient funds, the account owner gets nailed with overdraft fees. The only way to avoid this is to pay a $30 (approx.) stop payment order every six months until the check arrives. If it never arrives, you can continue to pay those fees forever.

Apparently the only safe way out is to close your account and open a new one. The fine print of the checking account agreement in that multi-page contract you signed when you opened your account will address the bank policy, or possibly, in the stop payment request form that you filled out.

Even if you have a statement like "Void after 120 days" printed on your check you can still be stung by your bank. Again, the fine print of the checking account agreement in that multi-page contract you signed when you opened your account will address the bank policy. Policies like these are in place to make it easier for the bank in their processing of checks, and are not intended to afford you, the customer, with any effective permanent protective measures.

This can be extremely frustrating and expensive should you get caught in this type of situation. However, the standard practices within the banking industry appear to rule.

Bottom line: A lot of people out there think that a stale-dated item cannot legally be paid. That is an urban myth and is simply not true. So, be very careful. It is always safer to not issue the check than to issue a stop pay order to your bank.

United Credit Source

Banks now need customer consent on overdraft fees

Banks will have to secure their customers' consent before charging large overdraft fees on ATM and debit card transactions, according to a new rule announced Thursday by the Federal Reserve.

The rule responds to complaints from consumer groups, members of Congress and other regulators that the overdraft fees are unfair because many people assume they can't spend more on a debit card than is available in their account. Instead, many banks allow the transactions to go through, then charge fees of up to $25 to $35.

For small purchases, such as a cup of coffee, the penalty can far exceed the actual cost of the transaction.

Under the Fed's new rule, which will take effect July 1, banks will be required to notify new and existing customers of their overdraft services and give customers the option of being covered. If customers don't "opt in," any debit or ATM transactions that overdraw their accounts will be denied, Fed officials said.

Many consumers do want checks and regular electronic bill payments to be covered in the event of an overdraft, Fed officials said. As a result, those transactions aren't covered by the rule.

Banks earn as much as $25 billion to $38 billion annually from overdraft fees, Fed officials said, but that total includes check overdrafts.

Many larger banks, including Bank of America Corp., JPMorgan Chase & Co., U.S. Bank and Wells Fargo & Co. began instituting similar "opt-in" plans in late September after coming under fire for the fees.

But consumer groups and other regulators, including Federal Deposit Insurance Corp. Chairman Sheila Bair, said new rules were still necessary to ensure smaller banks followed suit.

Many lawmakers have criticized the Fed for failing to provide sufficient consumer protection in the past, a defect they say contributed to last year's financial crisis. Sen. Christopher J. Dodd, D-Conn., on Tuesday introduced a bill that would strip the Fed of its consumer oversight.

Dodd also proposed legislation last month that would have imposed limits similar to the Fed's on the banks' ability to charge overdraft fees.

By CHRISTOPHER S. RUGABER, AP Economics Writer 11/12/09

United Credit Source

Five Ways to Make Credit Cards work for you

We've all been warned of the dangers of credit cards, and how they can work against you. However, they can also work in your best interest if you follow these five simple rules.

1. Pay off the balance each month. This will keep you from having to pay interest on your purchases and keep your spending from snowballing out of control.

2. Make your payments on time. If you don't, you can accrue late fees and trigger an interest rate increase.

3. Limit the number of cards you have. You really don't need more than a few. Applying for lots of cards causes inquiries on your credit report and can hurt you credit score.

4. Read the fine print of your contract so that you know what your credit limit is, your interest rate & when your payment is due. You need to know what you're getting into.

5. Don't exceed 50% of your credit limit. Keep it no more than 30% if possible. Credit Bureaus are interested in how much of your credit is available at any given time and that can affect your credit score as well.

If you're sick of credit cards and want to swear them off, that's understandable. If you're tired of receiving those pre-approved offers in the mail, you can opt out by calling 1-888-5 OPT-OUT or visiting this website .

United Credit Source can help educate you on your rights as a consumer and how to help improve your financial outlook and stability. There's hope, no matter what your situation.