Say Goodbye to Hidden Credit Card Fees

Direct Banc - The U.S. Senate is currently considering a bill which could possibly save consumers that use credit cards on a regular basis. The Bill, Credit Card Fair Fee Act, sponsored by U.S. Senator Dick Durbin (D-IL), contends that credit card issuers have an unfair advantage in the marketplace based on the fact that they control 40% of retail transactions across the country. The legislation is specifically aimed at the bank’s interchange fees that they charge on every credit card transaction.

These hidden fees charged by the banks are non-negotiable and force retailers to pass the charges along to the consumer. Under Durban’s bill, retailers would have the option to engage in collective negotiations (i.e., by forming buying unions) in an attempt to obtain lower interchange fees. Reportedly, but unconfirmed, Wal-Mart and other giant retailers have the power to negotiate lower interchange fees giving them an unfair advantage in the marketplace.

Interchange fees are charged directly to the retailer from the bank that issues the credit card, they’re usually around 2%. The issuing banks then kick up a portion of that fee to the brand name that is on the card, i.e. MasterCard or Visa. These fees are then deducted from the funds the retailer receives for the charges the consumer makes. All of these fees are hidden from the consumer, non-negotiable and have continued to rise in spite of a steady increase in credit card usage over the years.

Interchange fees were originally designed to offset the processing fees that banks incur from the extra work of “processing” the transactions. The portion that MasterCard or Visa receives was designed to cover marketing costs and a profit for the company. These fees now represent huge profit margins for the banks that issue the credit cards. All of these fees are eventually passed along to the consumer by the retailer who’s held hostage by the banks that charge the fees. If Mr. Durban has his way, these fees will become negotiable for smaller retailers and theoretically reduce credit card costs for consumers.

Opponents to the bill, Keith Nelson, the principal deputy assistant attorney general, feel that the bill, in its entirety, will actually stifle competition and result in even higher fees to the consumer. The portion of the bill that he is referring to is the clause that would set up a three person regulatory commission to arbitrate prices should retailers and the credit card companies reach an impasse in their negotiations. He contends that this would amount to government price fixing and ultimately result in higher fees for the consumer as a result of the arbitration.

Direct Banc, an online credit card authority,believes that both sides are right and wrong with their assessment of how to go about fixing this problem. Transparency in the marketplace is a fantastic idea; it gives consumers a clear picture of the real costs that is associated with using a credit card. Banks fear that too much transparency will curb the use of credit cards which will dramatically affect their bottom line. On the other hand, government arbitration will cause banks to negotiate artificially higher prices than the market dictates in expectation of market changes or increased processing expenses.

The way we see it, the answer is pretty simple. The bill should only allow the brand names i.e. Mastercard, Visa, and Discover, to charge an interchange fee and mandate that this fee be shown on the transaction receipt. Then, prohibit the card issuers (the banks) from charging any “processing fees” on the retail transaction. This will force the banks to pass along their processing costs and profits directly to the consumers in the form of a fee that is printed clearly on their statement. By doing this, consumers will see exactly what their credit card usage costs them. Once banks are forced to show the hidden fees, this will create competition between the banks which will help lower fees for credit card customers.

Author : Aubrey Clark is a writer and editor for Direct Banc, a directory of low interest rate credit cards that specializes in finding consumers great credit cards for fair credit. Mr. Clark lives in Atlanta, Georgia with his wife and four children

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Protect the Shell of Your Home With Buildings Insurance Cover

Anyone who takes out a mortgage will have no option but to take out buildings insurance cover. While it is compulsory and the mortgage lender will ask that you protect the outer shell of your home, you do not have to take cover from the lender. In fact by comparing quotes you will be able to save a huge amount of money on the cost of insurance and get the best deal. The easiest way to compare the cost of insurance is to go with an insurance broker and allow them to search for insurance on your behalf.

Buildings insurance cover would protect the outer of your home against damage. The amount that you want to insure your home for is the amount it would cost to totally rebuild your home from scratch. This does not take into account how much it would cost to replace the contents in your home such as your belongings. However a policy would generally cover fittings in the home that were not movable such as toilets, baths, sinks, fitted kitchens. In general anything would be covered that you cannot take with you if you should decide to leave the property.



Along with the outer shell of your home being insured with buildings insurance a policy would extend to other things. Such things as greenhouses, patio furniture, sheds and garages along with paths and walls are all usually included in the policy.

It is essential when shopping around for your insurance that you check what is and is not included in the policy. Some policies will include damage by such as from flood or fire, however some policies might ask that you pay extra for flood damage particularly if you live in an area prone to flooding. Subsidence is also generally included as is damage caused by vandalism or theft. When checking what is and is not covered in your policy look for accidental damage. This could cover pipe work underground, broken glass in windows and accidental damage to bathroom fitments. The majority of policies will exclude damage done by home improvements so always check for this.

With any type of insurance there will be a lot of exclusions and conditions set out in the policy so however boring it is the small print needs to be checked thoroughly before taking on the cover. Never just assume that something would be covered unless it actually states that it is you might not be able to claim on the cover if needed.

There will always be a certain amount that you will have to payout before the insurance company will pay on your buildings insurance cover. This is called the excess and the sum you have to stand to will vary. You need to check to make sure of how much this would be before taking on the policy. Usually the excess can be in the range of £50 to £100, however if you want to keep down the cost of your policy you could offer to payout more. However you would have to bear in mind that if your policy included breakages to glass in doors and you claimed on this then you would have to stand to the excess so it might not be worth putting in a claim.

Author : David Thomson is Chief Executive of BestDealInsurance an independent specialist broker dedicated to providing their clients with the best insurance deal on their home insurance, car and life insurance.

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Bad Credit Loans and Paying Bad Debts

While everyone likes to turn a blind eye to credit and debt problems, they do exist; there are people who have to deal with them every day. Some people have bitten off more than they can chew; whereas others have been affected by rising costs of living mixed with rising interest rates. For some people, the only way to take care of the loans and debts that they have is to take out a loan to help pay those debts. One bigger loan can be easier to pay than multiple loans and debts especially when they are in arrears, or in default. Most creditors and lenders charge a default rate sometimes adding 4-10% interest to the existing rate, making a bad credit loan essential to getting ahead. Bad credit loans do exist, and exist specifically to help people who have found that they are having trouble with debt. Applying for loans to pay off bad debts can be confusing, however. There is a simple way to go about using bad credit loans.

Understand Your Debt and your Credit

The first step in using a loan to pay off bad debts is to understand exactly where you stand. If you are looking for bad credit loans, you should be transparently informed of your current situation.


You should know how much you owe each creditor, how far in default you are, and how much interest you are paying, and if a creditor has listed your default with a credit reporting agency . By knowing all of the numbers and information, you are better suited to know if a bad credit loan will put you into a better situation.

Find a Company That Will Give you a Loan

The next step is to find companies that are willing to provide bad credit loans. By knowing what companies offer bad credit loans and what ones do not, you can help yourself save time through applying with the right company first time. The best way to find the right company is through the use of a Mortgage or Loan Broker, they have years of industry and product knowledge that can save an enormous amount of time in the application and loan research process.

The Bad Credit Loan Application Process

The application process is just as important as the research and information gathering process. When applying for a Bad Credit Loan; lenders require a list of documentation to be submitted with the loan application. This includes 100 points of Identification, a list of assets and liabilities, a copy of your credit report and a list of the outstanding debts you are looking to pay. All this information needs to verified using documentation. Once this information is put together, the lender assesses the information against their loan policies. If you, or you and your Loan Broker has done the right job an approval should be on the way.

Use the Money on Debt

Bad credit loans may be a little more difficult to find, but they are available. If you make sure that you know what you are getting into and what you need, they can be a good solution to a bad situation. By being careful and patient, you may find the help you need to remove your financial stress and regain your life.

Colin Kidd is a specialist in bad credit loans for families and business. Colin Kidd is the director of Loan Saver Network and has been providing finance options since 1999. For more information on bad credit loans please visit click here.

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Debt Consolidation Loan : Who Needs It?

A debt consolidation loan is, as its name suggests a loan that will consolidate all of your debts into one tidy package. The interest rate may be the same as the rates on the existing loans, or it may be somewhat less.

Defining the terms

Make certain that you have reviewed all the terms and clauses included in the debt consolidation loan before signing on the dotted line. For example, you should review the loan length, the interest rate, whether there is a prepayment penalty, and such terms as variable rate, fixed rate and balloon payment. If your consolidation loan applies to existing credit card debt, you should determine whether your cards must be surrendered to get the loan, and whether the balances are transferred to a new card, paid off, or whether you receive the cash and must do the payoffs yourself.

Benefits

The benefit for obtaining a debt consolidation loan is primarily to save money, but there are other advantages for those who reduce multiple debts to one payment monthly. You can probably save money on the interest rate, particularly if consolidating the debt means you can obtain a lower rate. Another advantage is the benefit of a single payment with a regular due date. You don't have to spend much time paying bills. Just set up an automatic payment and your bill paying is la minor part of your monthly duties. This type of regular prompt payment will make your credit report look better and better



Avoiding the pitfalls

For all the benefits that a debt consolidation loan can offer an individual, there are several drawbacks that you should be aware of before choosing to borrow additional money to solve your debt problems. If you are using this type of loan to bail you out from maxed out credit cards, you should certainly look at changing your spending habits in conjunction with the loan, or you can quickly end up in even more problems with larger debts. Consider getting rid of all your credit cards and switch to one debit card. Don't justify consistent overspending as an emergency. Create a budget and stick to it.

Find the best deal

It seems that finding the best deal would be logical, but many individuals looking for a debt consolidation loan take the first offer that they see and run with it. Often, had they looked further, they would have been able to obtain better terms, better interest rate and other accouterments of the loan. Take the time to review several loans and make certain to ask questions about each of the variables that affect the amount of your monthly payment. You won't want to keep applying and applying, as this can negatively affect your credit score, making the terms less desirable each time.

Reviewing interest rates

The main feature of your debt consolidation loan in most instances is the interest rate you will be charged during the duration of the loan period. Usually the rate of interest that the borrower is assessed depends on the credit report of the borrower. Credit scores higher than 700 make it easier to obtain the loan and generally means the terms of the loan are much more favorable to the buyer.

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Ready to Refinance Your Mortgage? Here Are a Few Tips.

The real estate market in many areas of the country is finally becoming less frothy and settling down. If you bought a home during that turbulent time you may not have gotten the best mortgage rates. Additionally home values have changed. Many areas are facing a down trending in home values meaning that their loan to equity ratio has changed for the worse.

It may be time to refinance that loan. Here are a few tips.

Be realistic as what can be accomplished and what can't. Most mortgage lenders require that the appraised value of the home be at least 20% higher than the mortgage. That gives them a cushion in case values drop. The appraisal is based on what comparable homes in your neighborhood have sold for. That's different than what homes are listed for sale at.

In most areas the selling price of a home and the square footage are public information. It may take a bit of digging to find homes that sold in your neighborhood but it will give you a better basis as to what you can expect. If you have a real estate agent for a friend they can easily provide the information for you.

While the appraisal is based mostly on square footage, an attractive, clean house with well maintained landscaping can't hurt. Get rid of clutter. And be aware of any peculiar odors.

Check your credit scores. Don't be unpleasantly surprised. If there are errors, such as a debt showing up that has been paid, get it cleared up before applying for a new mortgage. There is refinancing available for those with less than stellar credit but it's not at the low rates you might be expecting. You can check your credit scores online but you do have to sign up and provide some personal information. It's not instantaneous. Your identity has to be confirmed before you have access to your reports.

Don't wait until the last minute. Prepare the materials you think you'll need ahead of time. Most mortgage lenders want verification of income through tax returns, or paycheck stubs. They'll also want copies of bank and checking accounts, stocks, bonds, and other assets. If you're considering a major purchase put it off until you've refinanced your mortgage. Don't use your credit card or savings to finance that purchase.

Know what you want. There are so many alternatives from the standard 30 year mortgage. Don't let yourself be talked into terms which may sound good in the short term such as an interest only loan, but may turn out to be trouble in the long term. Refinance at a level that's comfortable for you. You may think that taking out a loan that is as high as possible is the best course of action, but remember you'll have a bigger monthly payment.

Shop around and compare mortgage lenders before you get mortgage quotes. Check the fees they require, time it takes, application procedures, points, and interest rates. It's amazing the variance you can find.

Author : Dee Power is the author of several nonfiction books. Want to know more about mortgage quotes? You'll get an idea of mortgage rates Learn more about mortgages and loans

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