Strategies to Reduce Debt
- Pay your bills on time or early.
- Always pay more than the minimum amount due.
- Keep any credit card balances low (50% or less of the credit limit).
- Know what's in your credit report and correct any mistakes.
- Make a written budget and stick to it.
- Save for a rainy day.
Did You Know?
- African Americans accumulate more than twice the debt of their white counterparts
• African Americans are at more risk of damaging their financial futures due to poor credit card management
• African American households spend larger percentages of their incomes paying credit card and other high interest rate debt, leading them closer to foreclosure or bankruptcy while enriching lenders
Credit Reporting Agencies:
Credit: The Mugshot of the 21st Century
Don't forget to keep your wallet healthy each year. Reviewing your personal information yearly ensures your information is accurate, allows you to correct any errors that may be listed, and helps prevent identity theft. Obtain a free copy of your consumer reports from each of the major agencies that collect information about you. Click here to download a Fiscal Fitness post card.
Maintain Good Credit
- Keep low balances on revolving debt
- Pay your bills on time
- Don’t make frequent requests for additional credit
- Pay loans first
- Make sure your information is correct
- Look for ways to lower your spending or increase your income.
The Laws
- Equal Credit Opportunity Act
- Fair Credit Reporting Act
- Truth in Lending Act
- Fair Credit Billing Act
- Fair Credit Debt Collections Practices Act
How Credit Laws Work
- Protect consumer rights and privacy
- Require businesses to give all consumers fair and equal opportunities
- Require businesses to ensure accurate information and resolve disputes over errors.
Dispute Resolution
- Dispute errors in writing
- Disputed items must be verified within 30 days of written requests
- Unverifiable disputed items must be deleted
- Consumer should advise creditor in writing that the information is disputed
Negative Information
- Negative information can stay on a report for 7 years, with the following exceptions:
- Bankruptcy may be reported for 10 yrs
- Credit information reported because of an application for more than $150K worth of credit or life insurance has no time limit
- When negative information in a report is accurate, only the passage of time can assure its removal
- Everything a credit repair agency can do legally, you can do for yourself at little or no cost