7 posts tagged “financing with credit cards”
Charlotte radio personality Ramona Holloway got a call the other week from her aunt, who sounded excited about a check she received in the mail.
The 66-year-old told Holloway the $3,999 check was from a company recruiting “mystery shoppers.” All she needed to do was deposit the check, buy a few products and review customer service at stores, then wire back $3,000 to test how money wiring services perform. She even could keep $300 for herself.
“(We) come from a long line on shoppers, so this was like hitting the lottery” for her aunt, Holloway said. “She thought it was the biggest blessing.”
But Holloway urged her aunt to first contact the local Better Business Bureau and bank. The check was quickly found to be fake, part of a scam seen around the country and the Carolinas.
It's just one persistent scam still making the rounds. A bad economy provides boom times for scammers, experts said, providing even more reason for consumers to be wary of what they get involved with and how they give out personal information.
“When the economy is down, scammers crawl out from under their rocks to take advantage of people,” said N.C. Attorney General Roy Cooper, whose office runs a consumer protection division.
Total complaints from the Carolinas to the Internet Crime Complaint Center are estimated to have increased by nearly 40 percent last year. Complaints topped 9,300 at the center, which is operated by the FBI and two other agencies.
Other scam-related surveys for 2008 are not finished yet. But Cooper and others report seeing a lot of credit repair, foreclosure, investment or mortgage scams, as well as offers to make a quick buck.
“At some level, you almost have to admire the scammers,” said Tom Bartholomy, head of the Better Business Bureau of Southern Piedmont. “They are pretty creative. They can be very successful, unfortunately.”
Here are some scams to watch out for:
Tiny credit card charges
How it works: Scams come in all sizes.
In the Charlotte area and around the country, for instance, charges as small as 25 cents have been popping up on credit card statements and billed to Adele Services of Melville, N.Y. But there is no phone listing for it, and consumer advocates say the company name appears to be fictitious.
Scammers could be testing credit card numbers to see which are real, and may use them later for much larger charges.
“If you get 25 cents from a million people, it can really add up,” said Mitch Katz, a U.S. Federal Trade Commission spokesman in Washington, D.C.
Tips: Bartholomy's office has received 20 or 30 calls about this issue. He tells them: contest any unusual charge on your credit card, no matter how small.
People should also monitor their accounts at least once a week.
Resources for
We are a week into 2009, and already it's been a roller coaster ride with the economy. We
have little or no control over what's happening in Washington and on
Wall Street. We do, however, have control over our own wallet. Financial guru Suze Orman spent an hour on Oprah Thursday afternoon showing us how to best manage our money in the new year. "If
you have credit card debt, your number one goal is to get out of credit
card debt before we have a savings, before you do anything. Your credit
card debt in today's economy, according to this action plan, has got to
go," Orman said. Local financial planners agree. Tom O'Brien is
a local CPA. He believes you should limit your consumer debt payments,
including your car loans, to less than 15% of after tax net take home
pay. He says a lot of people are way over that, and they get into trouble because they can't simply pay their bills every month. Orman
recommends paying the minimum on every credit bill you have, every
month. Then, pay extra on the card with the highest interest rate until
one-by-one you pay off every card. If your debt is under
control and your looking to start saving in the new year, there are
several options where you can still make a good return. Resources for
When it comes to New Year's resolutions, Kathy Johnson of Sacramento, Calif. has two simple money-savers in mind: "to get out of debt and pay off all my credit cards."
Johnson, a single mother, said her debts have accelerated due to health issues, unexpected veterinary bills and mounting interest charges.
Many are facing similar situations this year, especially given the painful enormity of 2008's job and investment losses.
Here are tips from a financial adviser, a credit card expert and a Certified Public Accountant.
-- Gather the paper
January is the perfect post-holiday time to collect your wits and your paperwork. Gather up all your financial documents -- bills, credit card statements, insurance records -- and create a filing system by category.
"Keeping financial and family records in an organized manner can save you time, money and trouble in the event of an emergency," said David Colgren, spokesman for the California Society of CPAs.
He recommends storing crucial documents -- such as birth certificates, property deeds, insurance policies, wills and power of attorney authorizations -- in a safe, fireproof location, such as a safe deposit box. Keep copies in clearly marked files at home. And be sure your spouse, a close friend or family member and executor (if you have a will or trust) know where those documents are located.
Also, CPA Perry Ghilarducci, owner and president of Avaunt Ltd. in Sacramento, recommends that if you've changed your marital status, bought or sold property, or want to change beneficiaries on life insurance and retirement accounts, take time now to review those documents, particularly your will and estate plan.
-- 'Power' down on payments
To get a lid on debts, write down all your income and every expense, including credit card payments, dentist bills, car loans, cable TV, even the daily coffee-and-muffin habit.
Hal Young, a financial adviser with Brecek and Young Advisors Inc. in Folsom, Calif., says the key is to eliminate enough monthly expenses to come up with a so-called "power payment." Whether it's $20 a week or $300 a month, it becomes an addition to your regular minimum payment on at least one outstanding debt.
He recommends making a chart, similar to the system in "Debt-Free on Any Income," by co-authors Lyle and Tracy Shamo. List every creditor by interest rate, monthly payment and number of remaining payments.
Resources for
Her holiday shopping almost wrapped up, one of Nancy Gustafson’s last purchases was a gift card.
But she was cautious. After hearing about some stores closing or leaving the area, she opted for a gift card from Macy’s, a company she feels will be around to back it up.
“I’m being very careful about some stores, looking for the longer- serving places,” said Gustafson, of Easton, Mass.
Gustafson did the smart thing, consumer experts say.
As the economy slumps, shoppers are trying to make the most of their holiday dollars, so they don’t want to take a chance on a gift card if the store might go belly up.
Consumers are seeing stores like Linen ‘n Things, Circuit City, Bombay Company and Office Depot get into trouble. The closings are largely blamed on the sour economy, the inability of the retailers to get credit and flawed business practices.
While there are state laws that say gift cards must be honored for seven years and many businesses honor them beyond that time, when a business goes under, consumers may be left holding a piece of worthless plastic.
Nancy Howlett, who works at Kingston Town Hall, went for gift cards from Dunkin’ Donuts and Kohl’s. “That’s a safe bet,” she said.
As consumers buy more sale merchandise, gift cards are not as popular this year, according to Ellen Davis of the National Retail Federation.
Gift card sales are expected to drop 6 percent from last year’s holiday season total of $26.2 billion. Overall, holiday sales are expected to increase a modest 2 percent as the economic downturn continues.
But in the final shopping days before Christmas, gift card sales typically increase.
The most popular cards among consumers are for coffee shops, local restaurants and personal services.
Luciano Villani, manager of Westgate Mall in Brockton, Mass., said people are still buying cards from their favorite retailers, but those who are uneasy with a specific store can buy cards that offer flexibility. These range from mall cards to bank cards that may be used where credit cards are accepted.
While retailer, restaurant and personal-service cards do not generally carry a service charge and some may even offer bonuses, there’s most often a service charge — typically $2 to $5 — for mall cards and bank cards.
Resources for
The strategy To keep my head above water this Christmas.
How do I do that? There's no doubt many people are finding the financial situation tough. Lower interest rates and petrol prices may have provided some welcome relief but as the economy slows, things are likely to get worse before they get better. The last thing you need is to blow the budget over the silly season and find yourself in strife as a result.
That means approaching this holiday season with a more disciplined approach. Credit Union Australia acting chief executive, Rob Nicholls, says consumers should set a budget for how much they can afford to spend rather than racking up big credit card bills to be paid off later on. Make a list of what you want to buy before you go shopping. Nicholls says people are less likely to impulse-buy if they've written it down first. Try to work out a budget for each item on your list and shop around for the best price. Retailers have been doing it tough too and the odds of finding a better deal have improved as a result.
Be realistic about what you can afford, Nicholls says, especially if you're putting it on credit to be paid for later. In fact, Nicholls says it makes sense to have a strategy in place to manage debt before hitting the shops this festive season.
What sort of strategy? By having a realistic picture of how much you're likely to spend, you can choose the most efficient way of using credit. If you know you can pay off your credit card when it's due, Nicholls says you can make good use of any interest-free period.
But if you're likely to take several months or more to pay off your Christmas spending, it may be better to use a card with no interest-free period but a lower interest rate.
If you're prone to bingeing, Nicholls suggests asking your card provider to reduce your credit limit. It sounds drastic but not having excess credit available removes the temptation to overspend.
Resources for
We are a country of spenders who must learn the hard way to practice what our grandparents have always known: A penny saved is a penny earned.
Read Full
Resources for
Scam: To trick or cheat someone out of their possession(s). A ripoff.
The internet is littered with scams such as pop-up ads or e-mail spam ads with "Get Rich Quick/High-Paying Jobs/You Are A Winner" messages. The use of credit cards has become so routine, one does not often think of the dangers.
When entering (Credit Card Scam) on the Google search engine, there are 39,800,000 sites with information regarding fraud. Predators and thieves have preyed on unsuspecting soles, to the tune of an estimated $52 billion this past year.
One such scam, called "triangulation," happened when an unsuspecting customer purchased an item via an on-line auction. The seller required a money order payment. As it turned out, items the original seller purchased on-line from Amazon.com were paid for with stolen credit cards. The thief was able to turn the stolen credit card numbers into cash, by purchasing items using the stolen numbers, then selling them on-line to an unsuspecting buyer for payment of cash.
Another unavoidable scam, is called "card tumbling" with the thief electronically using math variables to generate a sequence of numbers. Much like a locksmith, each number is tumbled until a correct sequence finally falls into place. They test it and the culprit has your card number to go shopping.
The list of scams and the length which predators go to steal your money and or your identity is endless.
In May 2008, U.S. News and World Report reported recent scams which work like this: A fraudster, claiming to be from the security department of a credit card company, tells the consumer he is checking unusual account activity. He may even offer a badge number. Then, he tells the consumer that a fake purchase, such as an $800 television from Best Buy, has been made on the card.
When the consumer says he did not make that purchase, the scammer explains that he is starting a fraud investigation and gives the consumer a "confirmation" number. He says he needs to verify that the consumer has the credit card and asks for the three numbers on the back of the card, known as the card identification number. He may already have the consumer's address and card number and that verification code lets the fraudster ring up charges on the card.
There are news media and Internet reports published almost daily of new inventive ways and the lengths which criminals will go to steal credit card information.
Listed below are some important steps and helpful reminders, which could help be secure with card cards.
Resources for
