Have you ever wanted to check your credit online only to find that all those “free credit scores” sites really aren’t free? You really have to read the fine print for these (in the Terms and Conditions section at the bottom of their websites) or most likely you will get burned. Always read the Terms and Conditions of any website BEFORE you pull out your credit card because sometimes they are so long and involved they will scare the living daylights out of you!

All you want is to be able to check your credit scores to see what they are. Nothing more and nothing less. But most of these so-called free sites want a dollar up front and they want that dollar so that they can get your credit card information. They might say the dollar is refundable so that they can technically say it is “free”. But the key is that you have to enter your credit card number and THAT is how they get you.

You see, they all have a “free trial period” which is most often 7 days and should you forget to cancel within the 7 days they will automatically charge your credit card $29.95 or some other amount that you obviously didn’t want to pay had you known the truth. You are then paying that monthly amount until you are able to get someone on the phone at their company and cancel. THAT is often hard to do.

Some of these fake “free” credit report websites are “freescore360.com”, “freecreditscore.com”, “freescoreonline.com”, “myfreecreditscore.com”, and many others. A general rule seems to be that if they have the word “free” in the URL name, they really aren’t free at all and a credit card is needed to get your scores. The credit card is the big warning sign that trouble is around the corner!

This type of free offer where you get charged at a later date is known as a “rebill” offer and you really have to be careful of them now days. The FTC has even gotten involved to stop these “rebill” type sites in some situations.

So, where can you find really free credit reports and scores online? I just signed up with Credit Karma and never had to pull out my wallet. I only got one of my three credit scores but hey, who cares as they are probably all similar. Credit Karma has an A rating with the BBB and they give you all sorts of charts and information that might be of value to you.

Right now everyone is pretty much in debt and looking for things like debt relief grants. But part of that is knowing what your credit scores look like as they can affect a lot of what you can do financially. It is a shame that so many of these credit score websites are misleading and really not free but it looks like Credit Karma is one of the good guys. They make their money by recommending products to you (that you don’t have to buy) and not by tricking you into a monthly fee.  

In an Ohio State study, it was found that being in debt actually added to young people’s self esteem. Both debt from paying for an education and regular spending debt from credit cards made young people feel better about themselves. This was especially true for people who came from poor backgrounds and less likely to be true for people who came from middle or upper class backgrounds.

Just the fact that any kind of debt could make people feel good is incredible and VERY SAD! Debt is never good (unless you are borrowing at low rates in times of high inflation) and it has become way to normal to have debt. Yes, debt from going to college means you went to college but it still means you have debt to weigh you down and pay back. An investment in your future doesn’t necessarily mean you HAVE to go in debt.

People in today’s world, especially young people, have no idea how hard it is to make money and repay debt. They have such an unrealistic and rosy view of the world that doesn’t include many of the financial burdens they will encounter. Too many young people just don’t realize how hard it is to accumulate money and pay off debt. Often time they don’t even know what taxes are because they have never had real jobs and had to pay it.

These are the same 20 and 30 somethings that are happy to be in debt now but will soon enough be searching for debt relief on their computers. When they get out in the real world for good and start looking for that job with the near 10% unemployment rate we have now, they will start to realize that the payments they have to make are a real pain. What about all the people who have lost their jobs and are having to file for unemployment? I’ll bet their self esteem has gone WAY down.

Much of this problem has to do with our poor education system and the often horrible job parents are doing now days of parenting. Debt should be explained to kids by their parents and taught to avoid it at all costs. Of course this is getting harder and harder as many parents are clueless themselves as we keep on voting in politicians that raise the debt in our country.

It seems everyone and everything is in debt now: but debt is NOT normal. And that is the problem that is really starting to bring this country down.

Debt is normal and everyone has it. There is nothing wrong with being in debt, any kind of debt, because all “normal” people have it. In fact, if you find someone who is not in debt you may wonder “what is wrong with them?”

These are the thoughts of Americans in the year 2011. There is no longer any stigma to being in debt. Declaring bankruptcy is no longer frowned upon, it is just something you do when you get in a bit of trouble. Debt used to be associated with buying a house or a car, two big ticket items that very few could afford to pay cash for. But now, debt is used for everything under the sun that people buy everyday.

I was taught by my parents that if I wanted something I had to save enough money before I could buy it. That’s how I paid for some of the toys I wanted that my parents wouldn’t pay for. I made money doing odd chores around the house as well as babysitting and summer jobs which helped my buy some of those things.

When I became an adult I stuck with the same principle that if I really wanted something, I needed to buy it with cash. Credit cards in my family are only used for convenience as I have never paid a cent of interest to any credit card company. I have been in debt for only automobile purchases and house purchases. I know many go into debt to finance their college tuition and that is most often unavoidable but I was lucky to have that paid for.

Everyone’s circumstances are different and not everyone is as fortunate as I am. That I understand. However, it is clear that way too many people buy things they can’t afford and have to go into debt to do it. They think that because everyone else is doing it, including our politicians, it must be okay. They haven’t learned to save before you buy and to pay for things with cash.

People are now desperate for money. This is the worst economy many of us have ever seen and folks are buried in debt, often with no way out. Unemployment rates continue to stay high and without jobs, people have little hope. In many cases the trouble they are in is because they never learned how to save for a rainy day because, people just aren’t taught to do that anymore.

It’s sad that some think that the government will help them out with debt relief grants or some other free money program. The government isn’t our safety net and never will be but too many of us think it is. Actually, our government is in more trouble than we individually are which poses a bigger threat to all of us. Having the kind of debt and the amount of debt many Americans have today is NOT normal. You may think it is based on what you see and hear but debt like this is a relatively new phenomena.

Debt is big business in America and around the world. I mean REALLY BIG BUSINESS! Thousands of companies make their money one way or another by you going into debt. They want you to be in debt and they want you to stay in debt so that they can keep making money.

First off there is the credit card industry. Everyone wants to give you a credit card and I’m sure you constantly get pre-approved applications in the mail just like I do all the time. They make it sound like they are doing you a favor and trying to make your life easier with their card. They will give you rewards, a better rate, and better service than the net guy. But all they really want is for you to use their card and hopefully run up your debt. Credit card companies make money when you don’t pay them off each month. They want you to only pay the minimum so they can charge you the maximum in interest.

Even all the big retail stores are in the debt industry as they try to get you to sign up for their credit cards. How many times do I have to tell these people I don’t want their Macy’s card as I try to buy my underwear and socks and try to get out of the store?

Next there is the loan industry. People need loans for cars, boats, houses, and any other big purchase. When you get a loan for any of these you are going into debt and you are paying for that “privilege”. Same as with credit cards, the loan companies hope you only pay the minimum each month. They DON’T want you to pay off the loan. They don’t make as much money if you pay the loan off and give them their money back so they hope you only pay the minimum.

School loans are big business now as well. College costs are way up and most students need a loan to get their degrees. It’s sad that so many college students have to borrow money just to complete their education. Many of these students will be paying off these college loans for 5 to 30 years after they graduate.

Finally there is the industry of debt relief. The system is set up to get you into trouble with debt and once you are, there is a whole network of companies that will help you get out of trouble. For a price of course. Debt relief is like operating on you after you get sick when it might be too late. They want you to get sick so they can get you on that operating table.

Is there really anything that can truly be called debt relief? NO, because the only thing that would qualify would be free money and there is no such thing as free money. There are no government grants for debt relief. There are no programs that will suddenly erase your debt. There is nothing that will magically make your debt go down!

Debt relief companies will promise you lots of things but they won’t get rid of your debt. Oh, they will “help” you by making you more organized by moving this loan over here and that loan over there. They will combine this loan with that loan and maybe get you a lower rate and they might give you a lot of fluffy advice on how to not get yourself into further debt problems. But none of this will come for free and you will be paying them because they want their cut and they are in business too.

That is the industry of debt and the way the system works now. Get as many people into debt and then tell them you will help them get out of it. Every business along the way profits from this scenario and the goal is to get you there and keep you there. The longer the better.

This is something that few people know and something I found out the hard way: opening and closing a credit card can lower your credit score. This is how I found out:

I had a credit score of just over 700 which is pretty good and it will get me most loans. The highest credit score possible is 850 so I have a ways to go. Anyway, my wife and I went to buy a mattress at Macy’s and they were offering a special deal where we could get $150 off for opening up a Macy’s card with them. I wouldn’t have thought about doing it for just $50 but $150 was a sizable amount off the mattress and so I did it.

Everything was fine and we had our mattress, got the discount, and we got the card in the mail which I was not going to use.

Two months later though, our car insurance was expiring and we got the renewal notice in the mail. To my shock our car insurance went up about $150 (coincidence) and we had had no tickets or accidents that last year. It was possible inflation was responsible for a price hike but a $150 was way more than inflation.

I called my insurance company and asked why my rates had gone up and after researching the lady told me that it was because my credit score went from OVER 700 to just UNDER 700. That 700 number was the break where people below it get charged more than the people above it.

I inquired how that could happen as I didn’t ever even use my credit cards and just have them for emergency situations. My credit should not have gone up because I had not used it at all that year. She then asked me whether I had gotten any new cards that year or closed any cards because that could affect my score.

New cards? No…….wait a minute…..there was a Macy’s card I opened for the $150 discount. Could that have been it?

Yep, she said, that could have been it. You see, your credit score is a rolling number and the older your credit cards are the better. Whenever you add on a new card you are taking on a brand new line of credit that can lower your credit score.

Likewise, when you CLOSE an account, the older the card you close the more it can lower your score because you are getting rid of a trusted old line of credit which makes your total score less trustworthy. It’s hard to explain and there are many factors that go into a credit score but opening a new card and closing and old one can adversely affect your credit score.

Credit and debt are not good things as we all know. It is best to only use credit cards for convenience (pay off the bill every month) or for emergencies. Your credit score is something that can be affected by the things you do with your credit cards and this is just one example. So be careful how you use your cards and try not to get into debt with them because it will be a lot harder to get out of debt than it was to get in it.

Earlier this year President Obama was successful in pushing through new rules for credit card companies that would limit late fees, interest rate raises, and all sorts of other things. The thinking was that these new rules needed to be put in to protect consumers from out of control fees and charges that were hurting regular consumers. Before a credit card raises the interest rates, it has to notify you and jump through some new hoops which help protect every day people. Sounds good right?

But it isn’t necessarily working out that way as many of these rules and regulations are making it harder for poor people to get credit cards it is raising rates on all of us. Businesses are there to make money and that will never change. When the government steps in and imposes new rules and regulations on them they usually lose money. Most of the time they then have to charge the rest of us more to make up for that lost income. That is what is happening here as credit card interest rates have gone up for all of us when interest rates in general have gone down everywhere else.

Who loses when credit card interest rates go up? Poor people do and all the people that use credit cards because they can’t afford to pay with cash. Weren’t those the EXACT PEOPLE President Obama was trying to help?

The stimulus bill and economic bailout of 2009 has also made it harder for anyone to get a loan at the bank. All lending institutions, including credit card companies, have made it harder to get credit since this economic downturn and the stimulus bailout. Right now it is harder to borrow money than it has been in recent memory. Who does that hurt? It hurts poor people that need payday loans and other loans just to pay their rent or mortgage and get by to the next pay period.

With legitimate loans harder to get because of Obama’s new credit card rules, poor people HAVE to go to all the sleazy payday loan places that charge 300% to 800%. You know the ones I am talking about: they are in strip malls in the poorer parts of town and promise to give you money right away. They will give you money but it comes with an astronomically high interest rate that hurts poor people a lot more than the small charges they might incur from a legitimate bank.

While credit card interest rates are high at 13% or 14%, that is a lot better than being charged 400%! Obamas new credit card rules hurt poor people because they push them away from credit cards and banks and make them have no choice other than to borrow money from the payday loan sharks that charge 30 times that! Or they might waste their time searching online for things like debt relief grants that don’t even exist.

Government laws are often instituted with good intentions but they often end up hurting the very people they are trying to protect. This is just one example how government does not have the solution to all our problems and often does more damage than people think.

It seems that people are still looking for something called Obama debt relief. With all the constant news about stimulus grants and the billions of dollars the government is giving away, it is only natural that people want to see what is in it for them. And with the economy doing so poorly, there are a lot of people in debt and in need of help.

A lot of businesses and local and state governments got bailout money from the stimulus package. People ask why there was no money in that bill for ordinary citizens who need debt relief grants or any other kind of financial help they can get?

The answer is because the 2009 stimulus bill was a political maneuver that was designed to get the economy going and to save some of the companies that were believed to be too big and important to fail. With unemployment still at 10% and things as bad as ever though, the evidence is showing that all that stimulus money did little to nothing to help things.

Nevertheless, people are still desperate for money and debt is piling up in many households. When jobs can’t be found, people have little choice other than to go in debt. Credit card debt is the worst because of the high interest most credit card companies charge. Right now, more families are in debt than probably ever before.

Debt counseling and settlement companies know this and that is why some of them might be using misleading advertisements to get your business. If you ever hear or see an advertisement touting the obama credit card debt relief act or The Obama debt relief plan, you need to know that there are no such things. They don’t exist and you can’t get help with your credit card debt from them.

So, even if you have heard somewhere that Obama has a debt relief program just for your situation, don’t believe it. And before you pay money to a debt relief consolidation company, know that the promises they are making might be exaggerated.

The government is forever trying to protect us from unscrupulous marketers and apparently they think debt consolidators fall into that category. Debt relief companies will no longer be allowed to charge fees before they perform their services. It seems debt relief is a grey area where companies make big promises of eliminating your debt or at least a big portion of it and then charge an up front fee for the service. According to the FTC, the promises are often not kept and the end result of their “service” is much different than what was originally promised. With the up front fee though, they already have their money and of course the person who paid the fee is then in a bigger financial hole than they were to begin with.

Under the new ruling, debt relief providers cannot charge a customer anything until a successful negotiation has taken place involving the settlement or reduction of the customers debt. Simply put, if the debt relief company is successful in helping a client reduce their debt, only then can they charge for their service. There will have to be lots of new written agreements in place so that the fee can be charged after completion of the debt reduction service.

So many people are in credit card debt right now and this bad unemployment isn’t helping any. The economy looks to be in a funk for many months ahead as no end is in site. This is causing more people than ever to search for debt relief grants and any other type of debt relief they can find. They hope to get Obama debt relief or some other kind of handout, giveaway, or help from the government but there isn’t anything like that. At least now, starting in a couple of months, they won’t have to worry about being fooled into paying for debt help from a company that might not be able to deliver on it’s promises.

With every credit card statement or bill you get in the mail, there is always a box that tells you the minimum amount due. It may seem that that amount is the least you can pay because the credit card company likes you and wants to be nice. No, the minimum amount due is what they WANT YOU TO PAY or hope you pay so that they can make the most money possible in interest from you.

Credit card companies make money by the outlandishly high interest rates they charge you. While you can only get about 1% interest if you put your money in a bank CD or a Treasury Bill, the credit card companies are very happy to charge you rates of 18% and higher. This is where they make their money and they want you to owe them as much as possible at all times. The more you owe them, the more money they make in interest as long as you keep on a schedule of paying them a little at a time.

It will take you many years to get out of debt if you only pay the minimum due every month. You HAVE to figure out a way to pay off more unless you want to be owing them money perhaps for the rest of your life.

The chart below shows the number of years it takes to pay off different amounts of credit and the chart is based on 19% interest along with a minimum monthly amount of just 2.1% of the outstanding balance. Remember, credit cards usually require low monthly minimums of between 2.0% and 2.5% of the outstanding balance because they WANT you to only pay that much. You need to fool them and pay more if you want to be successful at erasing your debt.  

How to enroll in an online debt relief program

At first, you need to fill out an online form. Then, a consultant (on behalf of the debt relief company) will call you for a free session in order to assess your financial situation. After assessing, the consultant may suggest a debt settlement program if it is the best suitable option for you.

What happens in a settlement program?

As you enroll in a debt settlement program, the debt negotiator (on behalf of the company) will start communicating with your creditors to reduce the total amount you owe. In the meantime, you will have to deposit a monthly amount into your settlement account with which you can pay your creditors as soon as they agree upon a pay off amount.

It may happen that an online debt consolidation and settlement company offers a consolidation program to you if it is suitable for your financial condition. It is advantageous over settlement as consolidation has a positive effect on your credit report.

What happens in a consolidation program?

In a consolidation program, the debt consultant (on behalf of the company) will negotiate with your creditors to reduce the interest rate of your loans/debts. With your creditors’ approval, he/she will also decide upon a monthly payment that you need to pay towards your debts. After you make the payment, the company will distribute it amongst your creditors.

It is quite important to choose a good online debt consolidation and settlement company to pay off your dues. Therefore, check its membership with TASC along with checking the company’s reputation from BBB (Better Business Bureau) to know whether or not there are any complaints against the consolidation and settlement company.