Chicago Bankruptcy Lawyer Blog

It seems that every time Americans turn around, there's a new credit card law going into effect. And though the purpose of all these rules is to protect consumers, they sometimes have unintended consequences.

Most recently, a law went into action this weekend to limit credit card penalties. Previous legislation enacted this year restricts credit card issuers from suddenly changing interest rates. On the one hand, both laws can help us save money on our credit cards. On the other hand, banks are finding fresh ways to take our money - this time, through higher interest rates on new cards and purchases.

Continue reading "New Credit Card Laws Lead to Higher Interest Rates for Chicago Consumers" »

The same principle that makes credit cards convenient also makes them dangerous. With plastic, there's no amount of cash holding you back from making a purchase. At least, not until now.

MasterCard recently announced a new program that could revolutionize budgeting for those of us prone to retail weakness and other forms of overspending. With inControl, consumers can place monthly credit limits on certain kinds of stores or purchases. Once the limit is reached, your card stops working - and, in theory, you start saving.

Continue reading "Could New Program Keep Chicago Credit Cardholders From Overspending?" »

Those credit card rewards might pay off after all.

Earlier this year, experts speculated that banks would cut back on rewards programs in retaliation for the new consumer protection stipulations in the Credit Card Act, say Chicago bankruptcy attorneys. But while some companies are indeed making rewards harder to come by, most banks aren't willing to give up customers to save money.

That's good news for those of us with overwhelming debt - if we use rewards cards wisely.

Continue reading "Many Credit Cards Still Offer Rewards, Even After the Credit Card Act" »

Telling Americans they need to save money right now is a bit like preaching to the choir - most of us are already scrimping and saving because we have no choice. But the truth is, even the most frugal among us are probably missing out on some good savings opportunities, say Chicago bankruptcy attorneys.

Sure, canceling big costs like cable or an unused gym membership is a no brainer, as is cutting out luxury goods like new clothes. But if you're still struggling to pay off your credit cards and lower debt, consider taking a look at the smaller expenses hidden right under your nose.

Continue reading "Finding Little Ways to Save Adds Up Big For Chicago Consumers With Debt" »

When it comes to consumer spending, our country suffers from short-term memory loss.

Sure, the recession has most of us balancing a budget, pinching pennies and generally thinking more about how we spend our hard-earned dollars. But when the economy picks up, many folks will go back to our old, sometimes irresponsible ways. Case in point: buying new cars.

Back a few years ago, it seemed that everyone had to have a brand new vehicle. It was a status symbol. If we couldn't afford to buy a car, we leased one. But not surprisingly, those new cars proved to be bad investments when the economy took a nosedive.

Continue reading "Used Cars Get the Job Done Without the Debt and Depreciation" »

Sometimes the most important thing we learn about in college isn't in our textbooks: debt.

With college tuitions at an all-time high, more students than ever are taking out loans - and now, they're defaulting in record rates. Over 30 percent of community college students defaulted on loans, according to The Chronicle of Higher Education. That number climbs to 40 percent for loans made to students at for-profit universities.

It's hard to make ends meet when you're going to school and working - heck, even when you're finished with school and working. But having thousands of dollars in unpaid student loans can haunt your finances well into the future, say Chicago bankruptcy attorneys. And while discharging student loan debt isn't as simple as it used to be, there are options available.

Continue reading "Record Number of Chicago College Students Default on Student Loans" »

It looks like the financial reform bill will pass - though just barely. But what does it mean for you - and specifically, for that debt you're carrying around?

If all goes according to plan, the overhaul will do more than aim to avert another financial crisis, say Chicago bankruptcy attorneys. It will alter the way we use our credit and debit cards and qualify for a home loan. What it won't do, however, is automatically solve all our debt problems. That's still up to us.

Continue reading "Pros and Cons of Financial Overhaul Bill for Chicago Consumers" »

Worried you have a bad credit score? You're definitely not alone.

More than a quarter of Americans now have a credit score of 599 or less, which categorizes them as a poor risk to lenders - that's 2.4 million more people than before the Great Recession, according to a recent report by FICO, Inc. That means more folks than ever will have trouble securing car loans, getting a good mortgage rate and qualifying for new credit cards.

But there's hope.

Continue reading "Bankruptcy Can Help Improve Decreasing Chicago Credit Scores " »

There's a big difference between debt relief and debt relief. And no, that's not a typo.

You've probably heard the advertisements on the radio and read them on the Internet - so-called debt relief companies claim they can negotiate with your creditors in order to get your debt paid off. They promise you'll have a low monthly payment and freedom from debt in just a few years, or even a few months. How can you go wrong, right?

But just because a company has "debt relief" in its name or slogan, that doesn't mean they can get the job done.

Continue reading "Bankruptcy Can Sometimes Lower Debt When Chicago Debt Relief Companies Can't" »

By now most of us are savvy to the most popular phishing scams - you know, those phony e-mails we get claiming to be from some rich person overseas who wants to wire money to our account.

But scams are always evolving. It's not enough simply to watch out for a name we don't recognize or a suspicious e-mail. In fact, we even need to be vigilant when dealing with e-mails that look legit, according to Chicago bankruptcy attorneys. Scammers are increasingly posing as familiar institutions - for instance, our bank, credit card company or online brokerage account. And many customers are falling for it - and losing money in the process.

Continue reading "New Scams Aim to Steal Money From Accounts of Chicago Bank Customers" »

You know you need to keep an eye on how much money you're spending, but it's also important to check up on what you've spent. Why? Because those numbers might not add up.

Recently the Federal Trade Commission disrupted a massive credit card scam that allowed a ring of criminals to steal millions of dollars from right under the noses of millions of unsuspecting consumers for four years. The thievery might have ended sooner, except for the fact that most victims didn't even realize they were losing money. That's because the scammers were stealing it pennies at a time.

25 cents here and 50 cents there might not seem like much, but when too much debt has you struggling to make ends meet and living paycheck to paycheck, you shouldn't have to give up a cent of your hard-earned dollars.

Continue reading "Why Chicago Credit Card Users Should Keep Close Tabs on Credit Statements" »

As banks pile on the account fees and other inconveniences, customers are starting to shop around. But to get the best banking bang for your buck, you need to be able to weigh all the options - and that means including credit unions.

Consumers often overlook credit unions because they assume they won't qualify for membership, according to Chicago bankruptcy attorneys. But many unions have been opening their doors to the general public, meaning you might be eligible for their notoriously lower rate credit cards and car loans. Hey, when you're struggling to manage bills and debt, a more affordable interest rate goes a long way.

Continue reading "Compare Banks and Credit Unions to Make the Most of Your Money" »

It's the ultimate reality check: thanks to the Credit Card Accountability Responsibility and Disclosure Act - or Credit CARD Act -we're forced to confront our debt problem every time we open our credit card statement. New rules require creditors to illustrate how long paying off our debt will take if we send only the minimum payment in each month.

If you have indeed been relying on minimum payments, seeing those numbers can be a real shock - sometimes enough to send you into denial. After all, when you realize your current credit habits will keep you in debt for decades - in some cases, forever - you might feel like, what's the point in trying? But you've got to remember that what your statement is showing you isn't necessarily a glimpse into your future. Instead, it's a reminder that you can change your future - and your debt.

Continue reading "Minimum Payments Cause Maximum Debt for Chicago Consumers" »

Uncle Sam is really laying into credit card companies lately - and I'm not complaining.

On Tuesday, just months after the latest Credit CARD Act rules went into effect, the Federal Reserve adopted a new set of credit card laws. This time, they're limiting late fees to $25 (instead of the $30-plus penalties many of us are accustomed to paying) and banning banks from charging a fee higher than the violation with which it's associated. They'll also put a stop to inactivity fees - in other words, charges for not spending money with your card - and multiple fees for the same violation.

But here's what the new credit card rules - which go into effect this August - won't do.

Continue reading "Chicago Credit Card Holders Can Benefit From New Late Fee Rules" »

With millions of Americans recovering from personal debts and the recent credit crunch, it's no surprise that paying with credit cards has fallen out of favor.

But is paper money really superior to plastic, or vice versa? In short, it depends on the person, say Chicago bankruptcy attorneys.

Finances are highly personal. While one shopper might need to physically part with their money in order to take a purchase seriously, another might find cash all too easy to spend because it doesn't come with an automatic money trail to hold them accountable.

Continue reading "Chicago Shoppers Should Weigh Pros and Cons of Spending With Cash and Credit" »