New Bankruptcy Law Will Not Protect You from Identity TheftWritten by Charles Essmeier
Recently passed by Congress with overwhelming support, oddly-named Bankruptcy Abuse Prevention and Consumer Protection Act was designed to eliminate “bankruptcy of convenience.” The perceived problem is that many compulsive gamblers, shoppers and drug users often run up huge debts on easily available credit cards with no intention of paying their bills. A relatively easy bankruptcy filing through Chapter 7 of Federal bankruptcy code wipes all debts clean and gives debtor a fresh start. Studies would suggest that most people who file for bankruptcy are actually suffering from sudden illness, job loss or some other catastrophic event, but law was passed just same, and debtors will now have to repay at least a portion of their problem debt when new law takes place in October, 2005.
A provision of new law that was not well publicized is fact that law applies to any debt, including debt which has been incurred through theft of debtor’s identity. If someone steals your credit card, or driver’s license, or both, and runs up a huge amount of debt by posing as you, then you will be held responsible for debt. Identity theft has become an increasingly large problem in last few years, but new legislation should make everyone aware of problem associated with identity theft. While a determined thief can probably steal anything, a few simple steps can make it harder for someone to steal your identity.:
Shred your documents. There are plenty of thieves that will sort through trash, looking for credit card receipts, bills and any document that has your signature. If
| | Debt Consolidation – Can You Negotiate with Your Credit Card Company?Written by Charles Essmeier
The average American household has nearly $10,000 in credit card debt, and many people are only able to make minimum payment of 2% of balance. Even 2% is $200, and by paying minimum payment, you could be paying on balance for decades before you finally pay it off. Since new legislation will make it more difficult to file for bankruptcy, it may occur to savvy debtors to try to negotiate a better deal with their credit card company in order to make it easier to pay off balance. Is this possible?
It might be possible, depending on your credit history, interest rate, and current balance. Your best bet, especially if you have a history of paying on time, is to simply call your credit card company and ask if they will lower your interest rate. They might, especially if you tell them that you got a better offer from another bank. If you have a history of paying late, however, they probably will not be willing to lower your interest rate. That’s unfortunate, since paying late has probably prompted credit card company to raise your interest rate in first place. Still, it’s worth a phone call; you may get lucky.
If you’ve been paying your bills on time, asking for a lower interest rate may be only option available to you. The credit card companies aren’t going to be too sympathetic to your financial
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