Dying spouse? How to handle credit cards

Category: Credit Matters
Published: Saturday, 17 October 2015
Written by Admin

A reader, Susan, reached out to us with a sad and serious problem: Her husband is dying, and they are wondering if the way they use their credit cards can keep her from having to pay his outstanding debts after he passes. Heres what she wrote to us:

My husband has terminal cancer and we are looking at finances. He has a few credit cards that are only in his name, I am just a cardholder on some of them. When he dies, I understand that I am not responsible for the debt. I realize that the [creditors] will try to collect from me. Whats the best solution to protect my good credit when all this happens but not pay his outstanding debts?

We asked bankruptcy attorneys on both coasts how they would advise Susan.

Northern California bankruptcy attorney Cathy Moran, who blogs at Bankruptcy In Brief, said Susans first move should be to check her free annual credit reports at AnnualCreditReport.com to see if card issuers report accounts where she is an authorized user (and not primary). Youre good, if they dont, she said in an email. If they do report the account, you have to consider whether you are really only an authorized user, and if so, dispute the report.

Connecticut bankruptcy attorney Gene Melchionne said state laws vary in determining how much of a deceased persons bills become the responsibility of a surviving spouse.

Both expressed concern about using any card with the idea that the debt would not be repaid. Moran said Susan may want to consider terminating her authorized user status or limiting her use of those cards. As a bankruptcy lawyer, Im concerned that continuing to use them, knowing that you dont intend to repay them, can be construed as fraud.

Melchionne shared the same concern.

In the bankruptcy arena, it is fraudulent to use a credit card with knowledge that the debt will be unable to be paid when the payments come due, Melchionne said in an email, but added that this might not be the general law in Susans state. Even if it is not fraud, there may be other reasons why she could be required to pay the bill, he added.

Some state laws make spouses responsible for each others necessities, he said. If there is a state law making spouses responsible for each others necessities (which may include medical care), the spouse can be held liable. Connecticut has such a statute, so even if the spouse were not legally liable on the debt by contract, she may be liable on the debt by operation of law. Also, its possible that Susans husbands assets would go to satisfy his debts before they could be inherited (so his outstanding bills could be paid even if Susan does not pay them).

But if creditors try to come after Susan? As merely an authorized user, you will need to be clear and firm in resisting efforts to get you to pay the debt, and vigilant that your spouses debts dont get reported on your report by checking it regularly, Moran said. (Susan can also check her own credit health with Credit.coms free credit report summary, which includes two credit scores for free every month.)

Finally, to avoid doing something that could be costly later, Melchionne advised consulting a lawyer. This is a case where the reader really needs to consult a good lawyer and get proper advice before taking another step in any direction, he said.

More from Credit.com

How to deal with credit matters after the death of a spouse
Can I get a credit card with no credit history?
Chase Slate review: A great bet If you need breathing room from your debt

Credit.com is a USA TODAY content partner offering financial news and commentary. Its content is produced independently of USA TODAY.

4 Things You Didn't Know About Your Credit Report

Category: Credit Matters
Published: Friday, 16 October 2015
Written by Admin

What you dont know about your credit report could be hurting you. And we are not talking about identity theft or fraud. We are talking about whats on there. Most people, in fact, are not well informed of how the credit rating system even works. Use this helpful article to find out what could be hurting (or helping) your credit rating, so you can take control of your financial life.

Credit Card Usage Matters

Most lenders want to see under 30 percent usage across the board, according to Balance Track. But they still want there to be some regular usage, too, otherwise why should they loan you money if they cant earn interest on it. Make sure your credit card balances are always below 30 percent across the board to maintain a premium credit rating. If your balances exceed 30 percent of utilization, consider paying them down as soon as possible to avoid being penalized points.

Judgments Can Last 10 Years

Dont ignore collectors. If they are unable to recoup the funds that you owe them, you most often will be sued in a court of law. If you dont win that case, which is usually not likely, the judge issues a judgment against you so the creditor can legally collect. These judgments are public record and never are removed from your credit report. But they only count against your point tally for about ten years, says Bank Rate. They can seriously impact your ability to be approved for credit in the future, and are something that future lenders will consider when determining your creditworthiness and ability to repay.

Foreclosures Dont Count After Three Or Four Years

Most people think that their financial life is over if they have a foreclosure. But thats not the case any longer. In the wake of the toxic mortgage debt fiasco, the federal government changed the laws. Now, after about three or four years from the date of the bank foreclosure have passed, the foreclosure legally drops off your credit report. It is still on there in the public records side, but the points come back and banks can reconsider approving you based on your current status, according to Credit.com. This can result in a serious increase in score, and can mean that you can now get approved for a new home loan.

Hard Inquires Affect Your Credit For 24 Months

If you are pulling to many hard inquiries, you can see a sudden point drop from your credit score. But how long will these inquiries remain on there? According to Credit Karma, 24 months. The good news is that they wont affect your credit after 12 months have passed. So apply sparingly and dont overdo it with credit applications.

Visit NowItCounts.com, The Destination for Americans 50+ covering financial, health, beauty, style, travel, news, lifestyle, food, entertainment and sports.

Earlier on Huff/Post50:

Business sentiment down for Q4: Survey

Category: Credit Matters
Published: Friday, 16 October 2015
Written by Admin

SINGAPORE: Sentiment among Singapore companies has hit its lowest level since the first quarter of 2013, with the mood especially dim in the manufacturing and transport sectors, according to the latest quarterly survey by Dun amp; Bradstreet (Singapore) and Singapore Commercial Credit Bureau.

The overall Business Optimism Index was barely positive at +0.14 for the fourth quarter of this year, down from +14.6 for the third quarter.

Among the sectors surveyed, firms in manufacturing and transportation were the least optimistic, while those in services and construction were the most optimistic.

Looking ahead, Dun amp; Bradstreet said conditions will likely remain challenging. Its CEO Audrey Chia said: Companies would continue to be very cautious moving into Q4. Expansion plans are put on hold, so we advise businesses to stay very vigilant, be it on cash flow or credit matters; this will help them to tide through the very bad times. 

Learn to Save and Weather the Storm.

Category: Credit Matters
Published: Sunday, 20 September 2015
Written by Admin

(ThyBlackMan.com) Without a plan in place from the start and learning to separate your needs from your wants, eventually finances become an issue. However, with a little discipline and recognition, you can change course and develop a happy relationship with money.

Life happens and when you spend your money on spontaneous purchases rather than saving for the future, you have no means for anything that comes along unexpectedly. Having a baby or suddenly losing a job are just a few of the things that can upset your delicate balance and throw you into chaos with your bills. The first thing to suffer is your credit, and then ultimately, your way of life.

The good news is that even though you may take a temporary hit on your credit score, you can recover and restore your finances to a level that sustains a sudden hit. The trick is simple: you must be responsible and patient. Being responsible means that your bills are the first things you pay each month. This comes before you reward yourself with a new gadget, furniture or other large item. As a rule, you should have at least three months reserve saved. While this may seem as though its a lifetime away, it really is not if you take a small portion of your check and put it away as if you never received it. This is your emergency fund.

To get started, you have to be willing to make temporary sacrifices. Make a list of your monthly bills on a sheet of paper and then draft a list of weekly expenses such as gas, food, school and so on. Calculate all of your monthly income and subtract the amount of bills and expenses from this total. What you have left is what you can use to pay down debt faster and create a savings, otherwise known as your emergency fund.

If you have the income to support your bills but an unexpected expense threw you off budget, you should be able to pick up the pieces and get back on track within a short time. If, however, once you list the expenses and income, you find that you have more going out than coming in you are going to have to make some changes.

Changes can be as simple as clipping coupons to save on groceries, or eliminating or reducing things on your expense list. For example, using coupons and shopping for sales at a few different stores can significantly cut costs on food. Taking the bus if you travel to work, and brown bagging instead of eating out are both positive ways that can help you stay ahead of your finances and keep a high credit score that will benefit you in the future. If you are way beyond any quick fix, you can take on a second job to offset the deficit until you pay down the outstanding debt. You can often gain inspiration from people all over the world. For example, check out Vickis credit story with her encounter with creditrepair.com, her story will give you the motivation to overcome anything.

Life brings twists and turns, bumps and bruises that come with handling money and credit matters. With a little patience and practice, you can move forward and achieve the quality of life you deserve.

Staff Writer; Corey Brown

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