I received this letter below from Consumers Union on this issue that I have been following for several months now.  It shows that our voices really do matter!  Although I don’t think this legislation goes far enough or takes place soon enough, the fact of the matter is that it is definitely a big step in the right direction.  Thanks to those who took action on this issue!   ~ Lisa ~

Thanks to you–your phone calls, your emails, your donations, the personal stories you shared with the press and lawmakers, the personal visits you made in Washington and at home–We Won!

The House of Representatives just passed the credit card reform bill on a bipartisan 357 to 70 vote. Yesterday it passed in the Senate 90 to 5. We don’t have information about the individual votes, or we would pass it along. Look for an update in next week’s regular ConsumerLine email newsletter.

The bill now goes directly to the President’s desk. We hope for a signing ceremony as early as Friday.

What does the bill do?

First, it moves up the effective date for reform. An earlier effective date for rate relief was a big part of your message to Congress since January. Then it: 

• Restricts all interest rate increases during the first year and restricts interest rate increases on existing balances
• Increases notice for rate increase on future purchases
• Preserves your right to repay under the old terms after a rate increase
• Limits fees and penalty interest
• Requires fair application of payments–not just applying your payment to the lowest interest balance
• Provides gift card protections
• Protects young consumers

And more! Here’s our updated page summarizing your new rights as a card holder.

It’s been decades since Congress passed credit card rules that were opposed by the credit card industry. Why did they do it? Because of you.

You turned your frustration with your card bank into action for real reform and you did it with passion and intelligence. Thank you for everything you do! 

Sincerely,
Pam Banks
CreditCardReform.org
A project of Consumers Union
1101 17th Street NW, Suite 500
Washington, DC 20036

Many thanks to William Mikula, a/k/a Dr. Credit, for the guest blog post today.  Credit money matters in Divorce….http://thecreditline.blogspot.com/

He writes a great blog with a lot of helpful information on credit matters.  I hope you’ll check it out!

From one of my favorite consumer groups - Consumers Union - comes this call to action (details below).  http://budurl.com/d8xf  Why are financial institutions being given immediate help and billions of dollars and yet, America’s people have to wait until 2010 for credit card reforms that need to be done now?!  In the meantime, the credit card companies are gearing up to gouge us while they can as they work even harder to make us indebted to them for life.

Yes, it is happening….twice this week I got notices from two of my credit card companies, Capital One and Discover, saying that they are changing the rules midstream as the current rules allow them to do.  Capital One will be jacking my interest rates up to 17.9% even though I have never been late and always pay more than the minimum every month, when possible even paying the full balance off.  The mailing basically said…this is what we are doing, take it or leave it.  If you don’t like it then close your account and you can find somewhere else to go….  So what will be in my wallet will be less of my own money, thanks to them.

So me, I’m leaving, hey Capital One you won’t be in my wallet!  Unfortunately for many people, they won’t be able to move their credit somewhere else due to credit issues of their own.  That’s why we need to take charge and demand accountability in all the financial sectors, especially the credit card industry….what I refer to as "Legalized Loan Sharks."

In the meantime, I’m taking action on this alert.  Hope many of your voices will join me.  ENOUGH IS ENOUGH!  Please add your voice.  http://budurl.com/d8xf

The Banks are at it Again!

Several major banks just hiked interest rates and fees on our credit cards, turning a blind eye to the millions of Americans struggling with the collapsing economy and higher unemployment. Just as we start getting that little increase in our paychecks, we have to turn around and give it to our credit card banks.

Media reports show Capital One hiked interest rates to 17.9% from 12.9%. Citibank raised their rates an average of 3%. While over at Chase, customers had a “choice” of paying a $120-a-year fee and a higher minimum payment, or a higher interest rate. Meanwhile, the interest rate banks charge each other for overnight loans is as low as 0%.

The Federal Reserve Board passed a new rule to prevent these sudden rate hikes, but it won’t go into effect until the middle of 2010. How many times before then will we get slugged with higher rates and fees just so the banks who got billions in taxpayer bailouts can increase their profits?

The chairman of the Senate Banking Committee just reintroduced his bill to put an end to these abuses, saying, “Mark my words: in the coming months, they will end." Other bills also have been introduced to crack down on these abuses.

Let’s help make it happen now. Tell Congress we can’t afford to wait until mid-2010 for credit card reform!    http://budurl.com/d8xf

Attention – Those considering or in the process of Divorce 

Are You confused and overwhelmed in your

divorce and don’t know where to begin?
 

Am I really getting my fair share?

Will I be able to afford to stay in the house?

What am I entitled to in retirement?

 What steps can I take now to avoid being saddled with my ex’s debt? 

How can I protect the payments I am entitled to if something should happen to my ex-spouse? 
 

If you answered yes to any or all of these questions then you don’t want to miss this teleclass:
 

Divorce Dollars and $ense 

Wednesday, March 11, 2009 

8:00 pm EST

We are offering this free teleclass so that you can be educated and armed with useful tips, tactics and tools to help you manage and survive your divorce! 

During this call we’ll be discussing:

·      What you MUST know about how to get your best settlement.

·      What kind of divorce options are available and who should be on your divorce team.

·      How a financial advisor can make a HUGE difference in your settlement - now and in the future.

·      What you MUST know about credit issues and bankruptcy to avoid getting burned.

·      Understanding spousal and child support issues.

·      Ways to protect your income stream or settlement agreements.

·      What you NEED to know about divvying up the marital pot.

·      What you MUST know about retirement - special issues around pensions, IRA’s, 401K’s and Social Security.

·      Why all assets are NOT created equal and how to get YOUR fair share.

·      And much, much, more….

I hope you’ll join us on this FREE call to learn more about how you can take control of your financial destiny and make your dollars go further with:
Divorce Dollars and $ense

Sign Up here - Divorce Dollars and $ense

Here’s a great article with information on bankruptcy and it’s effects on divorce. For more information on bankruptcy and divorce issues, don’t miss my next teleseminar this month, “Bankruptcy Basics and How to Avoid Being Burned in Divorce" with Christine Stadler, divorce and bankruptcy attorney.  February 25, 2009 7:00 pm.  Details for sign-up to be posted soon.

Bankruptcy During Divorce (posted at Lawyers.com)

by Sherrie Bennett

If you think you’re headed for divorce and have a lot of debt between the two of you, it might make sense to file for bankruptcy before starting a legal divorce proceeding. Filing bankruptcy first can simplify the divorce by clearing out some of your debt. This can make it easier to negotiate how the remaining debts should be divided, and protect you from your soon-to-be-ex’s bankruptcy filing down the road. Also, you and your spouse might want to consider filing a joint bankruptcy before the divorce. Not only will this make the final division of any remaining debts even easier, but filing a joint bankruptcy is cheaper than filing two separate ones. In either event, bankruptcies and divorces have serious impacts on each other, especially with respect to your property and personal finances.

Effect of Bankruptcy on Divorce

When one or both spouses file bankruptcy, all the community property, that is, property that was bought or acquired during the course of the marriage, becomes a part of the bankruptcy estate and is available to pay debts. The bankruptcy estate is simply all of your property that you own at the time the bankruptcy is filed.

When you or your spouse file a bankruptcy, an automatic stay immediately prevents creditors from collecting on most debts. But the automatic stay doesn’t prevent you from asking a divorce court to order your spouse to pay child support or alimony. Once a bankruptcy court decides property is "exempt," that is, it is not part of the bankruptcy estate and so it is not available to be sold to pay debts, a divorce court can then divide that property.  Property exemptions are defined not only by federal law (the "Bankruptcy Code"), but also by the laws of the state in which the bankruptcy is filed.

Some examples of federal exemptions include:

    * A specified dollar amount for real property that is for his or her residence, and

     * A specified dollar amount for one motor vehicle, such as your primary car.

Property Settlements and Bankruptcy

Negotiating a property settlement in the midst of bankruptcy is complicated. Debts related to a property settlement are presumed to be "nondischargeable" in bankruptcy, meaning that the person who files bankruptcy can’t have those debts wiped out and must still be responsible for them.

But the bankruptcy court will wipe out those debts if the person filing for bankruptcy can show:

    * That he or she can’t pay the debt and still take care of him or herself and any dependents, or

     * That wiping out the debt would result in a benefit to the person filing the bankruptcy that outweighs any harm done to his or her former spouse or child by nonpayment.

So if you think your spouse is contemplating bankruptcy after your divorce is final, you’ll want to word your property settlement in such a way that your soon-to-be-ex’s obligation looks and acts as much as possible like a support obligation instead of a property settlement. That is so simply because support obligations are more difficult to have discharged.

How do bankruptcy courts decide what’s support and what’s property settlement? It varies greatly by state, but courts have based their decisions on such questions as:

    * Does the obligation terminate or reduce with the occurrence of certain events, like remarriage or a child turning 18?

    * Is the obligation in installments or a lump sum?

     * Are there minor children? * What is the relative health and education of the parties?

    * Was there a need for support at the time of the divorce?

If your bankruptcy hasn’t been filed yet, these distinctions and problems probably won’t effect you. For many bankruptcies filed on or after October 17, 2005, any obligation between former spouses can’t be dischargedin bankruptcy. So, a spouse with an alimony and/or child support obligation can’t have that obligation discharged in bankruptcy if the bankruptcy petition was filed on or after October 17, 2005.

Property Liens

One way to protect yourself in a divorce negotiation if you think your spouse may be contemplating bankruptcy in the future is to take a security lien as a backup to debts your spouse is to pay you after the divorce. The lien should be on property your spouse is to be awarded in the divorce, preferably property that means a lot to your spouse. That way, if your spouse later asks the bankruptcy court to discharge the debt he or she is supposed to pay, you can seize the property to pay the debt.

Indemnity Clauses

Another precaution in the face of a soon-to-be-ex-spouse talking about bankruptcy is to have a "hold harmless" or "indemnity" clause written into the divorce decree, requiring your spouse to pay certain debts or repay you if a creditor makes you pay the debt. If your ex-spouse later files bankruptcy, you can go to bankruptcy court and ask the judge to enforce the indemnity agreement. While an indemnity agreement won’t guarantee you’ll get paid, it’s one more factor for the bankruptcy judge to consider.

As you can see, the issues of going through divorce and bankruptcy at the same time are confusing at best, and highly damaging at worst. If you find yourself in this position, it makes sense to find a bankruptcy lawyer who can help you with all the issues.

My colleague, Cindy Morus, has created a fabulous program, the Pay Debt Quickly system.  If you want some great ideas on how to get out of debt faster without any extra money out of pocket, then you must check out her program now!  And be sure to read the great tips below on what to do with your tax refund this year.

How to Have More Fun With Your Tax Refund in 2009 By Cindy Morus, Creator of the Pay Debt Quickly System

I counsel a LOT of people about money. I see the same mistakes being made over and over again. If you’ve made ‘em, don’t worry. I’m here to help you do it right THIS year!

The fact is, moneymakers need a money coach, just like gymnasts need a gymnastics coach. As your Money Mending coach, here are the mistakes in thinking and behavior I want you to avoid:

• Don’t think of your refund as free money - or lottery winnings. It’s not! That refund is your hard-earned dollars that you loaned Uncle Sam interest free - all last year.
• Don’t spend the refund - or OVERSPEND it - when you haven’t gotten the cash in your hands yet.
• Don’t spend the whole refund to pay down debt.

OK. So now you’re Money Smart about what NOT to do with that refund in 2009. Next, here are my EASY Money Smart moves that YOU can make to best handle your income tax refund this year.

First, divide your refund into thirds - 3 equal amounts. Why 3 equal amounts? Because we want to use that refund - however small or large - to handle the past, the present and the future.

Use one third to handle the PAST by paying down debts. Start with your most pressing debt…either the one with the highest interest rate, or the one with the biggest consequence for not paying it down.

Use one third for something you need or want in the PRESENT. If you can, use that money to have some FUN. Do something that is NOURISHING to you - something that makes you feel GOOD. How about a mini-vacation, or an evening of fine dining and great entertainment, or a day at the spa?  Of course, if the brakes on the car are shot, or you have some other pressing need, you’ll need to do that FIRST. 

Finally, use one third to handle some aspect of your FUTURE.

Here are several Money Smart suggestions for you to think about.

• Put money in your Anti-Emergency Fund.
• Put money in your Sleep EZ Fund or save for your retirement through your 401(k), 403(b), IRA (traditional or Roth).
• Put money into college education funds (Coverdell IRAs or 529 plans) for your kids or grandkids.

Why is this "thirds" approach such a great idea? Because you’ll be taking care of a variety of wants and needs - AND taking several easy Money Smart steps forward towards your BIG goal of financial freedom! THAT is how you can have MORE fun with YOUR tax refund in 2009.

Now is also a GREAT time to "check out your paycheck":

• Re-evaluate how much money you are contributing to your 401(k) or 403(b).
• If you got a whopping refund, remember you were just sticking YOUR money in Uncle Sam’s pocket. No point in giving Uncle Sam an interest free loan! Adjust your deductions so that you have just enough taxes withheld from your paycheck.

More Help from Cindy: Trouble with debt? Eliminate your debt and save your money using the Pay Debt Quickly System. It comes with the software and strategies you need get rid of your debt without making an large payments or making any significant lifestyle changes. Click here to learn more and get started right away or sign up for her free Powerful Debt Reduction Starter Guide.

Would you like to learn some simple techniques that could put thousands of dollars in your pocket over your lifetime?

·         Are credit worries keeping you awake at night?

·         Would you like to improve your credit rating, but don’t know how?

·         Do you believe you are powerless to keep more money in your pocket when it comes to your mortgage, credit cards, and insurance?

If you answered yes to any or all of these questions then you don’t want to miss this FREE teleconference:

CREDIT 911!

Wednesday, January 28th, 2009
7:00pm EST (USA) / noon PST (USA)

Go to my events page - Credit 911! to sign up now

http://tinyurl.com/774ymf