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Credit Card Tricks

March 8th, 2010 6:21 AM

Dirty Tricks From Credit Cards

· Dirty Trick No. 1:

Say "Bye-Bye" to Your Grace Period

No grace period means that you’ll start accruing interest the moment you charge something and that can cost you a bundle of “extra” interest. Most credit card issuers have already reduced their grace period from 25 days to 20 days. Many others have eliminated the grace period altogether. Now they are coming up with more and more reasons to take away your grace period. Miss a payment? Stop carrying a balance? Bye-bye grace period

· Dirty Trick No. 2:

Punishing You for Being Smart
These fees are the lowest of the low because they penalize you for being a responsible credit card user. Some of the biggest offenders include charging you a fee for:
· Closing your account
· Failing to use a card for a period of time (such as six months or a year)
· Not carrying a balance
· Every transaction each and every time that you use your card

· Dirty Trick No. 3:

Sending "Convenience" Checks
Credit cards often send you "convenience" checks so that you can write checks against your credit card account. Isn't that nice of them? Please! DON'T do us any "favors"! What they bury in the fine print is that these checks usually carry a very high interest and fees -- even higher than regular credit card charges. Some cards also give you no grace period

· Dirty Trick No. 4:

Inviting You to Skip a Payment
In their infinite generosity (ha!), some cards will "invite" you to skip a payment. This "helpful" offer, which sounds great at first blush, often comes after the holidays when your balance is big and your wallet is stretched. DON'T DO IT! Skipping that payment can lead to a host of trouble from a higher interest rate to possibly having to make extra payments in the future. Are you starting to notice a pattern?! You should be skeptical whenever your credit card company does something "nice" for you without you asking for it

· Dirty Trick No. 5:

· Lowering Your Minimum Payment

Another way some cards try to jack up their profits and lure you deeper into debt is by lowering the minimum payment due on your balance. It used to be cards required a minimum monthly payment of about 4% of your balance, but many now require as little at 2%. Don't fall for it! Going from a $40 payment to a $25 payment on a $2,500 balance means it will take you an extra 19 months to pay offDirty Trick No. 6:

Tricky Timing

We all know that our payment is due on a certain date or it's late, right? But a new twist being thrown into the mix is having your payment due by a certain time on the due date. If your payment is due at noon, and gets processed at 12:01, you get socked with a late fee AND likely a higher interest rate. Gimme a break! Carefully check your statement so you avoid this trap.

your balance

· Dirty Trick No. 7:

"Over the Limit" Fees

Credit cards charge you a hefty fee for going over your credit limit. Look, we don't have a problem with penalties for that. But now these fees have gotten excessive -- almost $40! Plus, credit card issuers don't exactly discourage you from going over your limit when they approve charges and balance transfers that put you over your m

Posted by Michael DiDomenico on March 8th, 2010 6:21 AMPost a Comment (0)

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Hurry get your Tax Credit

October 2nd, 2009 2:38 PM

First Time Buyers or those that have not owned a home in 3 years... Get up to $8000 Free money from the government's economic stimulus bill signed in on 2/17/09 by the President of the United States. This newly approved home buyer tax credit is for homes purchased between 1-1-09 to 11-30-2009. Now is the time to make your dream home a reality.

Highlights of the $8000 home buyer tax credit:

Tax credit for 2009 taxes will be equal to 10% of the home's purchase price up to a maximum of $8,000.
The principle home must be purchased between Jan 1, 2009 and Nov 30, 2009 to qualify for the new plan.
Tax credit does not have to be repaid.
Tax credit has income limits of $75,000 for single taxpayers and $150,000 for married couples.
This credit is available for all FIRST TIME home buyers, or those who have not purchased in the last 3 years.
Home buyers must remain in the home for 3 full years to keep the tax credit rebate.

The Web site at www.federalhousingtaxcredit.com includes basic information about the tax credit and a detailed question and answer section. It also includes information about other housing-related and small business measures in the legislation and a number of home-buying resources for consumers.

Posted by Michael DiDomenico on October 2nd, 2009 2:38 PMPost a Comment (0)

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HUD: Tax Credit Can Be Used on Closing Costs

June 4th, 2009 10:33 AM

FHA-approved lenders received the go-ahead to develop bridge-loan products that enable first-time buyers to use the benefits of the federal tax credit upfront, according to eagerly awaited guidance from the U.S. Department of Housing and Urban Development on so-called home buyer tax credit loans that was released today.

Under the guidance, FHA-approved lenders can develop bridge loans that home buyers can use to help cover their closing costs, buy down their interest rate, or put down more than the minimum 3.5 percent.

The loans can't be used to cover the minimum 3.5 percent, senior HUD officials told reporters on a conference call Friday morning.

Thus, buyers applying for FHA-backed financing with an FHA-approved lender that offers a bridge-loan program can get a bridge loan to bring down the upfront costs of buying a home significantly but would still have to come up with the minimum 3.5 percent downpayment.

There remain many sources of assistance for buyers needing help with the 3.5 percent downpayment, including many state and local government instrumentalities and nonprofit lenders.

In addition, some state housing finance agencies have developed their own tax credit bridge loan programs, so buyers in states whose HFAs offer such programs can monetize the tax credit upfront to cover all or part of their downpayment. These programs are separate from what HUD announced today.

The first-time homebuyer tax credit was enacted last year--and improved upon earlier this year--to help encourage households to enter the housing market while interest rates are low and affordability is high. The credit is worth up to $8,000 and is available to households that haven't owned a home in at least three years. The credit does not have to be repaid, and is fully reimbursable, so households can get their credit returned to them in the form of a payment.

Learn more about the credit, including how to apply for it this year even if you've already filed your taxes, at REALTOR.org.

Source: Robert Freedman, REALTOR® Magazine Online

Posted by Michael DiDomenico on June 4th, 2009 10:33 AMPost a Comment (0)

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Rate Lock Advisory

May 14th, 2009 1:31 AM

Rate Lock Advisory - Wednesday May. 13th

Wednesday's bond market has opened in positive territory following a much weaker than expected Retail Sales report. The stock markets are showing sizable losses with the Dow down 159 points and the Nasdaq down 26 points. The bond market is currently up 14/32, which will likely improve this morning's mortgage rates by approximately .125 - .250 of a discount point.

The Commerce Department reported this morning that sales at retail establishments fell 0.4% last month. This was much lower than the 0.1% decline that was expected and indicates that consumer spending is softening. Since consumer spending makes up two-thirds of the U.S. economy, today's report hints that an economy recovery may not be as soon as some analysts had thought. That is good news for bonds and mortgage rates because slowing economic activity makes bonds and mortgage related securities more attractive to investors.

Tomorrow morning also brings us an important economic report with the release of April's Producer Price Index (PPI). This index helps us measure inflationary pressures at the producer level of the economy. If it reveals weaker than expected readings, indicating inflation is not a concern at the producer level, we should see the bond and stock markets rally. The overall index is expected to show an increase of 0.1%, while the core data that excludes food and energy prices is also expected to rise 0.1%. A smaller than expected increase in the core data would be ideal for mortgage shoppers.

Also tomorrow will be the release of last week's unemployment figures by the Labor Department. Last Thursday's posting showed a sizable drop in new claims for unemployment benefits. Tomorrow's release is expected to reveal 609,000 new claims were filed, which would be an increase of 8,000. However, this data is not nearly important as the PPI is and will likely not influence bond trading and mortgage rates unless it varies greatly from forecasts.

Friday brings us the release of three relevant reports, including the very important Consumer Price Index (CPI). The other two are moderately important to the markets, but the group of three combined can create a large amount of volatility in the markets if they reveal surprising results. But the CPI will be the primary report of the day.

If I were considering financing/refinancing a home, I would.... Float if my closing was taking place within 7 days... Float if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

©Mortgage Commentary 2009

Posted by Michael DiDomenico on May 14th, 2009 1:31 AMPost a Comment (0)

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