Be a Smart Borrower
Know Your Balances—Keep track of all your debts—loans and credit cards. Stay aware of changes in interest rates, due dates or terms. Keep Records—Monitor your expenses. Retain receipts associated with your spending. Pay on Time—Pay your bills by the due dates. Past-due payments are reported to credit agencies and the consequences of missing a payment will hurt your credit scores. Maintain Good Credit—Make at least the minimum payment on all your bills on time. If you can’t do so, contact the creditor and explain your situation. Many will renegotiate your payments. Monitor Your Credit—Check your credit scores every year to ensure accurate data. Report any incorrect information. www.annualcreditreport.com Open a Savings Account or a Retirement Account—Establish automatic monthly deposits. Borrow Only What You Can Afford—Rule of thumb, borrowing more than you can afford results in mounting debt. Set a budget for saving instead of borrowing. Layaway Programs: Layaway purchase plans are designed for customers who want to buy merchandise without using credit or paying the full price immediately. |
To avoid problems, get the store’s layaway policy in writing. |
Layaways are not credit purchases. When you buy an item on credit, you take the merchandise home with you. When you use layaway, you typically make a deposit — usually a percentage of the purchase price — and pay over time until you have paid for the item in full. In exchange, the retailer holds the merchandise for you. Department of Regulatory Agencies (DORA) is your link to multiple consumer tips.
The following are just a few example of some of the links on the DORA Division of Banking’s webpage:
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choosetosave.org - One-stop shop site links to various sites which provide calculators for determining everything from credit card interest to monthly car payments. mymoney.gov - Provided by the U.S. Financial Literacy and Education Commission, this website is dedicated to teaching all Americans the basics about financial education. The following are examples from this link: Saving More 7 Tips on Putting Your Dollars to Work...for You!
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Borrowing Wisely Your Credit Score: It Pays to Aim High
- “Your payment history is the largest percentage of your credit score, so make every effort to pay your bills on time.” "Just because you have a $20,000 limit on your credit card or home equity line of credit doesn't mean you can borrow that much money…”
- Be proactive if your payment problems have already begun. Remember, if you can't make your mortgage payments, you risk losing your home to foreclosure. You need to seek help...and do so fast... by discussing your options with your lender or loan servicer (the company that collects payments and performs other work for the lender, including negotiating new payment plans with borrowers who are late or delinquent on their loan payments).
Take Charge of Your Credit Cards
- Use them carefully. Credit cards offer great benefits, especially the ability to buy now and pay later. But you've got to keep the debt levels manageable and pay on time. If you don't, the costs in terms of fees and interest, or the damage to your credit score could be significant.
- If possible, pay your bill in full each month. Remember, paying only the minimum due each month means you'll be paying a lot of interest for many years with little reduction in the amount you owe.
- For more guidance, see "How to Choose and Use a Credit Card" at www.fdic.gov/consumers/consumer/ccc/choose.htm.
Simplify your financial life. Have your pay and benefit checks deposited directly into your bank account. Arrange to automatically pay for recurring expenses, such as a mortgage loan, insurance premium or utility bill. Banking and bill paying online or by phone also can be good options.
These and other ideas can help you save time, reduce stress, eliminate clutter, lower the fees you pay, and maybe help you earn a little extra on your savings and investments.
$$$ Money Saving Tip—Do not pay up front—Mortgage modification or foreclosure prevention services do not require payment up front. Seek a free option by a HUD approved housing counselor.
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