Category Archives: Debt

Britons face growing debt

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According to The Telegraph, `Britons will be poorer in coming decades` because of the financial crisis.

The paper reports that Britain`s total public sector net debt will be `catapulted` from below 40% in 2008 to around 80 – or possibly even beyond 100%. This is partly due to the extra funds needed for financing unemployment benefits, `bailing out` banks, etc.

Ray Barrel, Chief UK Economist at the National Institute for Economics and Social Research, believes that Britons will have to deal with the fact that the UK will be poorer in the next few decades.

The Telegraph claims that the UK faces a `more serious long-term crisis` due to the make-up of its population. National debt could increase to around 200% of Gross Domestic Product (GDP – a measurement of the nation`s productivity) by 2050 because of the ageing of the population and the effect of pensions policies – according to calculations by S&P (Standard & Poor).

A debt expert for Think Money said: “A rise in the national debt is almost certain to lead to the Government spending less and taxing more, which could put a strain on many households` finances.

“Anyone concerned about their finances should contact a professional debt adviser without delay.”

Claim the $8,000 Credit for First Time Home Buyers?

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The $787 billion stimulus package passed in February included a new $8,000 tax credit for first time home buyers, in addition to the $400 tax credit per worker. Can you claim it? The First-Time Homebuyer Credit Form 5405 from the IRS helps answer some of the questions regarding eligibility for the credit (or not), and is also the form you would fill out and file with your taxes in order to submit the claim at tax-time.

Who is Eligible?

While it seems that you should be eligible for a first time home buyer credit as long as you buy your first home, like anything else there are conditions to the eligibility for the $8,000 credit.

If you are buying your first home (to be your primary residence) after April 8, 2008 and before December 1, 2009, and you meet the other conditions for eligibility – your home purchase qualifies. However, the credit for homes purchased in 2008 is $7,500 – and homes purchased in 2009 receive the $8,000 tax credit. If you’re married, neither you or your spouse can own any other main home during the 3 year period prior to the date of your purchase. If you’re building a home, the day of “purchase” is the day you start living in the home. Continue reading →

Weed Out Bad Consolidation Companies

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Being in debt involves a lot of decision-making and financial choices. Each individual is entitled to get enough information so they may continue to make informed decisions when it comes to their finances. Whether it be services or solutions or step-by-step methods for eliminating debt, each debtor has a responsibility to themselves (and their families) to choose the best debt-reduction method that makes sense for their individual situations.

When it comes to choosing debt consolidation as the method to get rid of debt, many will find the consolidation plan works easily into an established budget and enables them to meet debt-free goals they might not otherwise be capable of reaching. Debt consolidation companies help to eliminate penalties and fees that accrue on unpaid bills and typically the results of the consolidation process are quickly realized. Continue reading →

Frequently Asked Questions about Debt Collectors

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According to the Federal Trade Commission, a debt collector is any company or person with the business purpose of collecting debts that are owed to others. Debt collectors may be collection agencies, companies that buy debts from other businesses and then attempt to collect the money, and lawyers who collect debts regularly. The FTC is a consumer protection agency that is responsible for enforcing the Fair Debt Collection Practices Act. Under this act, consumers are protected against collectors using abusive, deceptive or unfair practices in their efforts to collect money from you.

Here are some frequently asked questions about your rights under the Fair Debt Collection Practices Act, and about debt collectors in general:

What debt is covered under the Fair Debt Collection Practices Act? Basically all debts that are not incurred to run a business are protected under the Act. Personal, household, family debt on credit cards, automobile loans, personal loans, medical expenses and mortgages are all covered under the Act. Continue reading →