Prime Rate Credit

Yep, I always forget that China is on a very different time zone than we are, as well as fiscal schedule as a result, and even though we haven’t even hit new years eve here yet on the east coast of the US, the Chinese stock market has closed for the year.

The Chinese stock market has become quite a hot topic this year of 2007, since the US economy has been pretty questionable for a long time now, and many feel that we are headed for a possible recession and are afraid to invest in the US stock market.

Many financial analysts and speculators have turned to investing in foreign markets, and one of the hottest markets is the Chinese market, which is said to grossly outweight the GNP of the US already. China is definitely going to take over the US as the next economic super power, it’s really just a matter of time, according to most people in the know.

Many who are frustrated with the US stock market and the fear that seems to be gripping the US economy and consumer confidence have turned largely to Chinese stocks, and even Indian stocks. In short, the middle east is quite a hotbed for rich American investors right now!

Many Chinese stocks are now available on the New York stock exchange, which makes it that much more convenient for American investors to snatch up stocks they believe are going to be profitable and for companies that they may know a little about, or at least a little about the industry, enough to make an educated guess as to whether to “bet” on the stock or not.

Due to the recent credit crunch and mortgage foreclosure crisis, the Federal Reserve is proposing rules for all lenders, including brokers and banks. Proposals offered for regulations should be instated by next year.

One of the regulations proposed by the Federal Reserve is to make certain that lenders know, in advance of completing a loan, that the borrowers have enough money set aside for taxes and insurance. The Federal Reserve also plans to restrict loans in which there is no proof of a borrower’s income.

One other proposed regulation is to ensure lenders have examined a borrower’s ability to repay on a loan. Clarity will be enforced by improving financial disclosure so that the borrowers understand fully the terms and conditions of their mortgage and also may have used helpful items like a mortgage calculator that calculates a darn near close monthly payment before they jump into the contract.

Another area considered for enforcement is prevention of lenders penalizing the borrower when they pay their loan off early. Abuses in mortgage advertising will be another area the Federal Reserve will address.

The Federal Reserve will need to balance their proposed regulations so they won’t suppress legitimate and responsible lending and so they still allow refinancing opportunities for those subprime borrowers.

Home values have declined and homeowners are often left with a mortgage balance that exceeds the amount they can sell their home for. Therefore, the homeowners in financial trouble often don’t have the option of selling their home to alleviate their financial woes.

With the foreclosure crisis and the current credit crunch, we are at increased risk of recession, so the time is right for the Federal Reserve to take action.

Just wanted to take the time to wish everyone a wonderful holiday, no matter what holiday you celebrate around this special time of year. And don’t forget, PRC will be providing the best news in finances, credit card deals, credit card news and more reviews of the best credit cards and loan deals out there, so you can get the PRIME RATE every time!

Have a wonderful Christmas tomorrow, and here’s to cherishing family and friends and the continued health and prosperity of our families. God bless!

Have you ever noticed that when you’re in a major retail store that offers their own store charge cards, that you are always encouraged to use their card to pay for the sale? And further if you politely say no, they ask if you have one of their store credit cards.

After you politely say no again, they ask if you’d like to sign up for one of their credit cards. There is usually an enticement of some sort of additional, albeit small, discount on top of any other discounts you might already be receiving, usually about 10-15%.

I’ve even had sales people go so far as to ask me why I don’t want to sign up and get the additional percent off, and I’ve had to be firm and say “because I have enough credit cards already” or “I used to have one of your cards and I don’t use it any more.”

What brought this up is that I was just in a major national retail establishment and was somewhat forcibly asked, by both people who waited on me (I had two separate transactions), if I wanted to sign up for/apply for one of their store cards, and I can’t help but wonder if the sales associates get some sort of commission or bonus for sign ups.

Otherwise, what would be their motive for pushing the store credit card so hard? I mean, it only makes sense - I for one would never ask anyone if I knew it didn’t mean extra money in my pocket one way or another. Customers do need to remember also that every hit on their credit could potentially impact their credit score.

This is another reason why I don’t apply for too many things unless I’m really serious about using it a lot. Otherwise, I’d probably be applying for gas credit cards and things of the like all the time just for the perks!

I never knew this until someone who knows a lot about credit scores and credit history told me to keep my applications to a minimum, because creditors may access that on reports and see that as a tendency to over extend on the part of the consumer. Who knew?

Credit card interest rates are notorious for being higher than almost any other loan rates on the market. If you are a good customer that pays on time every month and pays your balance down, you would think that your already elevated interest rate should remain stable. This is not always the case.

Credit card companies can still raise the interest rates on your balance if your credit rating has dropped due to credit snags elsewhere. Bank card issuers can raise the interest rates by a sizable degree over the amount initially agreed upon.

Congress is looking at this type of credit card business as unfair practices for customers that are paying on time. This is to be differentiated from the offers of a low introductory rate or if the cardholder violates the initial agreement with the bank card issuer.

For consumers trying to work their way out of debt, the ballooning and unexpected increase on the interest rate makes becoming debt free or at least getting their debt more manageable an impossible feat. Consumers that find their interest rates hiked are urged to contact the credit card issuer and negotiate repayment options.

The credit card industry counters that they have notified consumers in these situations of interest rate hikes and give them the chance to either opt out or contact the credit bureaus. Credit card company executives insist that they, as lenders, must consider consumer risk profiles when considering interest rates.

The plan by the Federal Reserve is to require 45 days notice to the customer before raising interest rates and more clarity in information about fees charged by the credit card companies.

Watch your bills and statements closely for any alterations in terms and conditions, especially for finance charges and interest rates.

I’m not sure if they have this in all states, but sometimes this program really saves me a lot on gas money for my car, which happens to be a small SUV. It is smaller, but it still gobbles a little more gas than your average sedan, so I do try to find gasoline deals whenever I can so I have extra expendable income on things I actually want to buy, instead of things that are a necessity (who likes spending money on that, it’s no fun!)

The card I’m speaking of is the Giant Eagle grocery store chains’ “Advantage card”. It’s just like all the other major grocer chain’s member cards, in that you present the card when you are buying your groceries, or scan it in when you are going through self checkout lines, and it keeps track of how much you are spending with each trip. The bottom line is, for every fifty dollars you spend, you receive ten cents off each gallon of gas at their special Giant Eagle sponsored “Get Go” gas stations.

It may not seem like a lot, but when you have a family or you just consume a lot of groceries, it sure does add up. Once I went to get gas and found that I have a whopping two dollars off of each gallon! Of course, that was after a few months of heavy shopping, but you get my drift - it’s worth having and is probably one of the most genius marketing ploys I’ve ever heard of.

I often wonder how they even make money off of it, but they must somehow, because their gas stations are always packed every time I go to get gas at one of their gas stations. I bet many of the gas credit cards that are out there offer similar benefits, I just have yet to look into that because I happen to have the special Giant Eagle gas station right by me, and a Giant Eagle right by me as well, so convenience is a huge factor in this case.

Another cool thing about the Giant Eagle advantage card and gasoline program is that many times they run promotions where if you buy a gift card through them (they sell many, for many stores from Best Buy to Toys R Us), they will double your gasoline points, so you end up really making out if you end up purchasing your gift cards for people as gifts from them.

The best gas credit cards out there (do your research) are probably the way to go these days while the gas prices are so high, you just never know how much you’re saving until you really sit down and add up how much you spend on gas each week, especially for those of us who have long commutes to work (like me).

I myself, since I am young (I’m 33 years old, this is very young when it comes to investing and letting money grow over time, and I’ve already been investing via my 401k at work and other outside smaller investments since I was in my early twenties), tend to invest in higher risk, higher yield mutual funds as well as stocks that are geared more toward growth.

This means they may have volatility in the short term, which is why they would not be a good choice for those that are near or at retirement age, but for someone who has lots of years to invest and let their money grow, like me, they are better because over the long term, their gains and losses even out more, and their long term gains tend to be much better than those “safer” stocks and mutual funds that are recommended if you simply want to keep pace with inflation and not beat it, as well as have some pure profit in your pocket afterwards.

So, how do you know whether to invest in higher yield, higher risk portfolio additions, or the less risk, but also likely less payoff mutual funds and other investments such as government bonds and such? Well, it is always best to seek the help of a financial professional. However, a word of caution on this. Get a seasoned professional with a track record for making people’s portfolios profitable.

The difference between someone like say a college student and someone who has been in the workforce for several years have very different needs and may want different viewpoints from different types of financial counselors that have mroe experience with certain segments of the population.

There are some really good financial advisors out there, but there are also the ones that do not necessarily make the right choices for their clients when it comes to risk vs. payoff assessment. You may want to get recommendations from friends who have established a good rapport with their financial professionals, and you also may want to pay attention to whether your financial advisor works on commission for directing you to certain funds and stocks, or whether they are something called “fee based”.

If they are fee based, this means that they just get a flat fee for investing you in a certain fund, and that’s it. They do not really have incentives to get more out of you, because it is a flat fee. I took my dad along when I went with my financial advisor because he has many years of investment experience and is a former stockbroker himself, so he was able to explain to me the difference between the two.

I had initially chosen a “safe” financial counselor before when I had gotten myself in over my head with college student credit cards and needed both a financial advisor and someone to help bail me out of my credit card mess, and that was just something that suited me for that time in my life, and I now have different goals and agendas when it comes to making financial decisions for the long haul.

We all want to escape when our debts seem to be unconquerable, don’t we? I know myself, when I found myself way in over my head in credit card debt as a part time college student, struggling to pay the bills, and using credit cards to pay for schooling and books, as well as living expenses that were unexpected, like car repairs, and even sometimes extra groceries, it seemed as though I would never pull myself out of the mire of mounting credit card debt, bills, and interest rates that I couldn’t keep up with at that time.

Fast forward five years, and I am now debt free through smart saving, and dilligence in paying off my bad debts, which were namely high interest loans and revolving interest credits like credit cards that jacked up their rates on me for late payments, or a poor credit history. These days, thankfully, I’m back in good graces with creditors through a lot of tenacity in getting this monkey off my back.

I tried to play the credit card game of transferring balance to low apr balance transfer credit cards, and that only bought me a little more time. What I really needed was a solid budget, extra money and a little more determination, and I could be out of debt, which is exactly what I ended up doing.

The recent big story that’s in the news about a man named John Darwin really brings to light the lengths people will go to to avoid huge debts that seem totally out of their control, and the stressors that it places on people’s lives. This is sad, because many people feel so hopeless when their money situation gets out of control, and they feel it will never improve, that some even carry it as far as intense depression and even suicide.

John Darwin is a man who faked his own death, pretending that he died on a canoe trip several years ago, and of course no body was ever found, so that his wife may collect on his life insurance policy and pay off the debts that had mounted beyond his control - at least in his mind they were out of his control.

The British man was tired of “being dead” to his children, who are now five years older, and showed up out of the blue, acting as if he had amnesia, because he missed his children. He had holed up in the family’s home for five years, and his sons and police had believed him dead all these years. When the story first broke, it was told as if he were a miracle, but when the facts came to light that he did it to avoid mounting debt, he is now being questioned and possibly is going to be charged with fraudulent acts if he is convicted.

His wife finally confessed that he had faked his own death and was holing up in the home, hiding from everyone, so it may even be possible that she would be charged with aiding and abetting some sort of fraud. I for one have sympathy for this type of situation. Anyone who has ever been under extreme financial duress can probably identify with this.

Although many of us would not take it to this extreme and may disagree with it on a moral level, we cannot deny that when we have been through periods of such intense despair that we haven’t had the feelings of wanting a way out - a way to escape.

I just wanted to post a quick update on that class action lawsuit that was settled with multipled credit card companies. You can make your claim, if you got a notice in the mail with an official claim number at the top left of the letter, online, and it’s very easy - I just did mine with option one, which is to receive a flat $25 refund for overcharging of currency conversions. They did note that the amount could be adjusted but I figured hey, since I make multiple charges overseas for business purposes, I might as well take advantage of it.

The place you can make the claim is at www.ccfsettlement.com which was specially set up just to take these claims. They do warn that you may have to wait a while if you choose to call your claim in, so the online way may be the best. It’s a very simple online form and took me a few seconds to send.

In a move that was expected by most financial analysts, the Fed did end up cutting key interest rates down another quarter of a point today, down to 4.25, in an effort to keep the United States out of a recession and help the ever-worsening mortgage, housing and credit crisis. This was a move that was anticipated though, as Bernanke himself did not rule out another rate cut.

However, some are disappointed that there was not more of a cut than a quarter point, and feel more drastic measures were needed to pull us out of the quagmire we’ve recently found ourselves in. The stockmarket did not react well on the news, and did take a bit of a fall, but we all know it always comes back up - at some point….