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Credit Cards
A
credit card is a credit system used to pay for goods and services with the convenience of a small plastic card issued to users of the system. A credit card is different from a debit card in that it does not remove money from the user's account after every transaction. In the case of credit cards, the lender lends money to the consumer (or the user). It is also different from a charge card (though this name is sometimes used by the public to describe credit cards), which requires the balance to be paid in full each month. In contrast, a credit card allows the consumer to 'revolve' their balance, at the cost of having interest charged.
Credit cards make up for 2/3rds for the amount of consumer debt. Whether you are a student in college just starting out, an established business owner or just the average working American. Chances are if you have any type of credit it will more than likely include some type(s) of credit card.
Lack of financial discipline carries a stiff price. One can easily find themselves in financial debt when misappropriate use is a factor.
You will only want to use the cards for things you would have bought anyway, and I always pay the bill in full. If you can understand the full aspects of this method you will find that credit will always be a great financial tool for you.
Most consumers, however, overwhelmingly see credit cards as a quick way to get into debt. Truth is the average consumer simply does not know how to fully use credit for their benefit. More than a third of credit card holders will use their cards for the purchases of goods that they really can’t afford. No wonder, by some estimates, the average American household with at least one credit card has more than $10,000 in credit card debt. This number may not be direct overdue debt, however if you were to fall into some serious financial hardship what would it take to get you debt free is the true question?
- Based on actual studies more than 90 percent of people surveyed did not know how long it would take to pay off a credit card if they made only the minimum payment. More than half underestimated the time to pay off a $1,000 bill, which is seven to eight years.
- Nearly 80 percent realize they should check their credit score periodically, but only half do so occasionally. And while 72 percent understand they may benefit by consolidating balances on a single card, only 22 percent have done so.
- Most credit card holders don't like the card they have but don't do anything to try to find a better one. When asked why they simply have no reasonable explanation. Nearly 90 percent shred or throw away promotional offers they get in the mail and only one in five has searched actively online for a card suited to his or her needs.
There are many types of credit cards as well as accounts. Many credit cards offer different types of incentives. There are many benefits of owning a credit card. Some are good and some may be bad. It all depends on the ways that use them. If you are one of the many Americans that are in debt for the sole reason of credit card misuse or maybe you have fallen into some type of hardship the first thing that you will want to do is contact your creditors and cancel all of those accounts (leaving at least one open). The one card that you choose to leave open will be the one with the lowest balance and lowest apr. This card will be for paying bills and reestablishing your credit. At the same time you will need to set up some type of repayment arrangement. Do not just neglect those accounts and let them fall into collections. You want to prevent this from happening. Many creditors will work with you as long as you come to them before they send the accounts to collections. Most creditors will not discuss repayment once your account has been sent to collections.
If you don’t have a credit card and would like to obtain one shopping around for a credit card can save you money on interest and fees. You’ll want to find one with features that match your needs. Two great credit cards that I recommend are no-fee and cash-back-rewards credit cards. By using the appropriate card for each purchase (each gives higher rewards with certain merchants, such as grocery stores or gas stations). With these types of cards one can easily find themselves making a profit by using their cards. You can find good rates as well as reasonable offers at
CreditCards.com or other sites such as
CreditorWeb.com. You can also do a simple Google search with the keywords “credit card” and find others. You understand that the better your credit is then the better the rates you will receive. In other words the higher your credit score is then the lower the rates will be. That goes both ways. The lower your credit score is then the higher you should expect the rates to be.
Statutes
You have rights that protect you from the amount of time a creditor may leggally act on an unpaid debt. These rights are called statutes of limitaitons and they vary from state to state. below you will find the lists by state on the amount of time a creditor has before they loose their right to sue you on an unpaid debt.
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| Statutes of limitations for each state: |
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| State |
Oral contracts |
Written contracts |
|
Promissory notes
(installment note) |
Open ended-accounts
(including credit cards) |
| Alabama |
6 years |
6 years |
|
6 years |
3 years |
| Alaska |
6 |
6 |
|
6 |
6 |
| Arizona |
3 |
6 |
|
5 |
3 |
| Arkansas |
3 |
6 |
|
5 |
3 |
| California |
2 |
4 |
|
4 |
4 |
| Colorado |
6 |
6 |
|
6 |
6 |
| Connecticut |
3 |
6 |
|
6 |
6 |
| Delaware |
3 |
3 |
|
6 |
3 |
| D.C. |
3 |
3 |
|
3 |
3 |
| Florida |
4 |
5 |
|
5 |
4 |
| Georgia |
4 |
6 |
|
6 |
4 |
| Hawaii |
6 |
6 |
|
6 |
6 |
| Idaho |
4 |
5 |
|
10 |
4 |
| Illinois |
5 |
10 |
|
6 |
5 |
| Indiana |
6 |
10 |
|
10 |
6 |
| Iowa |
5 |
10 |
|
5 |
5 |
| Kansas |
3 |
5 |
|
5 |
3 |
| Kentucky |
5 |
15 |
|
15 |
5 |
| Louisiana |
10 |
10 |
|
10 |
3 |
| Maine |
6 |
6 |
|
6 |
6 |
| Maryland |
3 |
3 |
|
6 |
3 |
| Massachusetts |
6 |
6 |
|
6 |
6 |
| Michigan |
6 |
6 |
|
6 |
6 |
| Minnesotta |
6 |
6 |
|
6 |
6 |
| Mississippi |
3 |
3 |
|
3 |
3 |
| Missouri |
5 |
10 |
|
10 |
5 |
| Montana |
5 |
8 |
|
8 |
5 |
| Nebraska |
4 |
5 |
|
6 |
4 |
| Nevada |
4 |
6 |
|
3 |
4 |
| New Hampshire |
3 |
3 |
|
6 |
3 |
| New Jersey |
6 |
6 |
|
6 |
6 |
| New Mexico |
4 |
6 |
|
6 |
4 |
| New York |
6 |
6 |
|
6 |
6 |
| North Carolina |
3 |
3 |
|
5 |
3 |
| North Dakota |
6 |
6 |
|
6 |
6 |
| Ohio |
6 |
15 |
|
15 |
6 |
| Oklahoma |
3 |
5 |
|
5 |
3 |
| Oregon |
6 |
6 |
|
6 |
6 |
| Pennyslvania |
4 |
6 |
|
4 |
6 |
| Rhode Island |
15 |
15 |
|
10 |
10 |
| South Carolina |
10 |
10 |
|
3 |
3 |
| South Dakota |
6 |
6 |
|
6 |
6 |
| Tennessee |
6 |
6 |
|
6 |
6 |
| Texas |
4 |
4 |
|
4 |
4 |
| Utah |
4 |
6 |
|
6 |
4 |
| Vermont |
6 |
6 |
|
6 |
6 |
| Virginia |
3 |
5 |
|
6 |
3 |
| Washington |
3 |
6 |
|
6 |
3 |
| West Virginia |
5 |
10 |
|
6 |
5 |
| Wisconsin |
6 |
6 |
|
10 |
6 |
| Wyoming |
8 |
10 |
|
10 |
8 |
|
|
Oral Contract
An oral contract is a contract that terms of which have been agreed by spoken communication, in contrast to a written contract, where the contract is a written document. There may be written, or other physical evidence, of an oral contract – for example where the parties write down what they have agreed – but the contract itself is not a written one.
In general, oral contracts are just as valid as written ones, but some jurisdictions either require a contract to be in writing in certain circumstances (for example where real property is being conveyed), or that a contract be evidenced in writing (though it may be oral). An example of the latter being the requirement that contract of guarantee be evidenced in writing that is found in the Statute of Frauds.
Similarly, the limitation period prescribed for an action may be shorter for an oral contract than it is for a written one. |
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Written Contract
A written contract is a legally binding agreement between two parties. A written contract is some what the same as a oral contract except for the fact that it is written on some tangible form. Some states, in certain situations, require that you have a written contract over an oral one.There are 4 things that makes up a contract:
- offer: a clear offer by one person or organisation to another. If an offer is rejected then that offer automatically ends;
- acceptance: the other party must accept the whole offer without conditions. For example, if an art buyer offers you $500 for your painting and you say that you would take $600, you have not accepted the buyer’s offer, but made a new offer that the buyer can accept or reject. This is referred to as a “counter offer”. There can be many offers and counter offers before there is an agreement;
- consideration: this is what each party gives to the other as the agreed price for the other’s promises. Remember, the agreed price doesn’t have to be money. It can be another benefit; and
- intention: the people or organisations entering into the contract must intend to create legal relations.
A person who breaks a contractual promise may be sued. They may have to pay the other person compensation or comply with some other court order. |
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Promissory Note
A promissory note is a form of debt – similar to a loan or an IOU – that a company may issue to raise money. Typically, an investor agrees to loan money to the company for a set period of time. In exchange, the company promises to pay the investor a fixed return on his or her investment, typically principal plus annual interest.
While promissory notes can be legitimate investments, those that are marketed broadly to individual investors often turn out to be scams. The SEC and state securities regulators across the nation have joined forces to combat the fraudulent sale of promissory notes to investors. But we can't stop every fraud.
That's why you should ask tough questions – and demand answers –
before you consider investing in a promissory note. Be sure you understand how they work and what risks they pose. These tips will explain how promissory note fraud can occur and will help you to spot the scams.
Open-ended Accounts
The term “open ended credit account” means a account under which the creditor reasonably contemplates repeated transactions. Also known as a revolving account. A “open ended credit account” has no set terms of repayment. A consumer’s monthly charges may vary depending on the charges that was made for that billing period. Keep in mind that any open credit card account is considered a open-ended account.
