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Credit Card Bailout Bookkeeping News
Credit Card Bailout Bookkeeping News
Credit Bailout: Issuers Slashing Card Balances
Published: June 15, 2009
The banks were bailed out last fall, the automobile companies last winter. For Edward McClelland, a writer in Chicago, deliverance finally arrived a few days ago.
Mr. McClelland’s credit card company was calling yet again, wondering when it could expect the next installment on his delinquent account. He proposed paying half of his $5,486 balance and calling the matter even.
It’s a deal, the account representative immediately said, not even bothering to check with a supervisor.
As they confront unprecedented numbers of troubled customers, credit card companies are increasingly doing something they have historically scorned: settling delinquent accounts for substantially less than the amount owed.
The practice started last fall as the economy worsened. But in recent months, with unemployment topping 9 percent and more people having trouble paying their bills, experts say this approach has risen drastically.
They say many credit card issuers have revised internal guidelines to give front-line employees the power to cut deals with consumers. The workers do not even have to wait for customers to call and ask for a break.
“Now it’s the card company calling you and saying, ‘Let’s talk turkey,’ ” said David Robertson, publisher of the credit industry journal The Nilson Report.
Only a few creditors are willing to confirm the practice. Bank of America and American Express say they decide on a case-by-case basis whether to accept less than the full balance. Other card companies refuse to discuss the subject, but their trade group, the American Bankers Association, acknowledges that settlements are becoming more common.
The shift comes as the financial services industry finds itself losing some of its legendary power. A credit card reform bill that makes it harder to raise rates on existing balances and prevents certain automatic fees flew through Congress and was signed by President Obama in late May.
Borrowers still have a crushing amount of debt to deal with, however.
Revolving credit, a close approximation of credit card debt, totaled $939.6 billion in March. The Federal Reserve reported that 6.5 percent of credit card debt was at least 30 days past due in the first quarter, the highest percentage since it began tracking the number in 1991. The amount being written off was also at peak levels.
After a balance has been delinquent for six months, regulations require the card company to reduce the value of the debt on its books to zero. If a borrower has not paid by this point, chances are he never will.
“The creditors would rather have a piece of something now instead of absolutely nothing down the road,” said Adam K. Levin, the founder of the consumer education Web site Credit.com.
Banks and credit card companies are discussing new programs that would, for the first time, allow credit counselors to invoke reductions of principal as a routine part of their strategy, said Jeffrey S. Tenenbaum, a lawyer for many counseling agencies. In the past, counselors could persuade card issuers to adjust interest rates and modify late fees, but the balance was untouchable.
An example of how quickly the card companies are shifting their approach is in the behavior of HSBC, a major issuer, toward Mr. McClelland.
He was paying fitfully on his card, which was canceled for delinquency. In April, HSBC offered him full settlement at 20
Traditionally, the creditors could play tough with any accounts that became delinquent because the cardholders had assets. The creditors could sue or place a lien on a cardholder’s house.
As the recession grinds on, though, many cardholders have less to lose. Mr. McClelland, 42, is a renter. Since he is self-employed, he has no wages to garnish. But he did not want to feel like a deadbeat.
“Having this over and done with was appealing,” he said. He raised the agreed-upon $2,743 and sent it off electronically last week. He has spared himself the prospect of years of collection calls.
HSBC said it did not comment on individual cardholders and would not discuss its policy toward settlements. “Every customer situation is unique,” said a spokeswoman, Cindy Savio.
The card companies, perhaps understandably, do not want to promote the idea that settlements have become merely a matter of asking nicely. The creditors also point out that a delinquency, like a foreclosure, destroys a credit record.
And there can be a Catch-22: those with the fewest assets are the likeliest to receive a settlement offer, but they are also the least able to come up with the cash for that final negotiated payment. Some creditors, though, are helpfully letting people stretch this out over months.
Still, a line has been crossed, credit experts say.
“Even in the early stages of delinquency, settlements can be dramatic,” said Carmine Dorio, a longtime industry executive who ran collection departments for Citibank, Bank of America and Washington Mutual.
During the boom, nonpayers were treated more harshly because, paradoxically, their debt was more valuable. Collection agencies were eager to buy bundles of old debt from the card companies for as much as 15 cents on the dollar. In a healthy economy, even the hopelessly indebted can pay something.
In this recession, where collection agencies have little hope of collecting from the unemployed, that business model is suffering. Experts say 5 cents on the dollar is now the most a card company can hope to get for its past-due accounts.
Another factor undermining the card companies is the rise of debt settlement firms. These are profit-making companies that charge fees, nearly always in advance, to bargain with creditors on a consumer’s behalf.
Settlement companies are under fire from regulators, who say they promise much and deliver little. But their ubiquitous ads, which make a settlement seem not only easy but also a moral victory over shamelessly gouging card companies, have done much to spread the idea.
Although there are few independent statistics on the settlement industry, there is no doubt that some generous deals are being done.
Consider Bedros Alikcioglu, a gas station owner in Newport Beach, Calif. He owed $112,000 on four cards and was paying $3,000 a month in interest and late fees. “It was so hard to earn that money, and paying it to nowhere didn’t make sense anymore,” said Mr. Alikcioglu, 75.
He signed up with a debt settlement company named Hope Financial, which negotiated deals with his creditors to settle for about 35 percent of his balance. Hope Financial is charging Mr. Alikcioglu about 12 percent of his original debt.
“I did not want to leave the legacy of bankruptcy,” Mr. Alikcioglu said. “I am now at peace.”
Bookkeeping Embezzlement Bookkeeping News
(California)
Bookkeeping Embezzlement
Regarding the news story about the woman who was charged with taking $40,000 from little league:
It never ceases to amaze me, the audacity of bookkeepers whoe embezzle money from their clients. In the news story mentioned above, the bookkeeper in reference was even a board member of the little league!
The article states that she embezzled approximately $40,000 dollars, but that is just an estimate. It is likely that they will never know the true total amount embezzled due to cash received from concession stands being harder to track.
The manner in which she embezzled was to write herself a check, but make it look like a vendor was paid on the books. She ended up being found out when Vendors started inquiring above her head with regards to where their missing payments were.
Which leaves me to question; How could she possibly think that the Vendors wouldn't at some point demand the money owed to them and thus she would be found out? How could she steal from a children's league? How could she serve on the board and look in the faces of her peers?
Obviously, this woman has extremely poor judgement and integrity. But it just never ceases to amaze me, the audacity of bookkeepers who embezzle money from their clients!
What do YOU think?
Do you know of anyone who has ever embezzled money?
How did they do it?
How did they get caught?
Review of Bookkeeping Practices Bookkeeping News
by Stephanie
(USA)
Review of Bookkeeping Practices
Here is a good bookkeeping article regarding doing an annual review of your bookkeeping practices.
The basic points are:
Success and bookkeeping are essential to every business. Each business will have varying levels of success – and failure – and each level will often coincide with the efficiency of your bookkeeping department.
Tax season has come and gone, and if you are like most, you struggled through receipts, credit card statements, checks, and invoices, attempting to make sense of all the paperwork before handing them to your bookkeeper or accountant to get your taxes filed on time.
Now that the shopping bags filled with paperwork have been emptied it may be time to start a fresh new bookkeeping system. With the software available today there is little reason to fall behind in the bookkeeping department. The bookkeeper needs to be focused, intense, and strictly black and white.
With tax season behind us, it's the perfect time to review the past year of accounting and bookkeeping practices and make the necessary changes you need to increase profits, decrease costs, and make next March and April a little more peaceful.
Online Work From Home Bookkeeping News
Online Work From Home Bookkeeping News
Many sites showcase people making as much as $300 a day working online from home on their computer.
Are online jobs the next big thing? For Mary Steadman it sure is. Mary, a mother from San Jose, CA is thriving, in the middle of an economic recession working in the comfort of her own home.
From her website: "I get paid about $25 for every link I post on Google and I get paid every week... I make around $5500 a month right now"
Mary's story is a very familiar one in these tough times. She lost her job as an account rep for a manufacturing company and a few days later her husband also was laid off from his job as part of cutbacks due to the bad economy.
"We knew we had to do something, so we put our heads together and started trying online job opporuntities." Mary and her husband Kevin wound up getting caught up in a few quick rich business opportunities that were nothing more than pyramid schemes before finding something that really worked.
"I realized the best thing to do is instead of hoping that a company that you are looking at is going last, why not go with a big, reputable company. After looking at several different companies, I picked the safest bet... Google."
Online giant Google is a publicly traded company and is worth an estimated $100 Billion (with a b). The company has pioneered online search and has changed the way we use the internet.
In a matter of weeks Mary and Kevin had a steady stream of income coming in via checks that were delivered to their home. They happened upon a system called "Easy Google Profit" that taught them how to make money posting links online.
Easy Google Profit is a free course that can teach anyone, regardless of computer skill level to start making money online. It's available for free at EasyGoogleProfit.com.
"We were doing pretty good and then we discovered the real trick to making money. We combined "Easy Google Profit" with another free course called "My Internet Payday" that's where we really learned the extra tricks so instead of making a couple of hundred bucks here and there we started maximizing the amount we made."
For those of you that have seen the 'scammy' sites on the internet that promise you can make millions of dollars online Mary warns that this is not the promise being made here and that most of those sites are false representations of earnings you can make.
"We never tell anyone they'll make millions of dollars, in fact I think this is the ONLY online system that says you probably WON'T make millions, but you can generate a legitimate income from home like I do that replaced my full time job."
Getting started is simple. Following these simple steps below is all you need to do to get started.
Step 1: Get Easy Google Profit, only pay the $1.00 for shipping.
Step 2: Also get My Internet Payday. This is key. I think you pay $1.95 for shipping or something. to post. Start posting those links. Google tracks everything.
Step 3: Follow the directions on Easy Google Profit that basically shows you how to and set up a Google account. You need them both. Then they will give you the website links to post. Start posting those links. Google tracks everything.
Associated Links:
Easy Google Profit official site
My Internet Payday official site
Read Responses for “Is Working Online At Home The Next Gold Rush?”
1.
aDiane says:
April 29, 2009 at 7:55 pm
I saw this on the news. How lucky is she to have found this opportunity!?!?!
2.
a Marco says:
April 25, 2009 at 8:33 pm
The timing of this couldn't be better, my wife and I are struggling too and this could be our answer.
3.
a Mikey says:
April 13, 2009 at 9:12 pm
Thanks for the info, just started this 3 weeks ago. I've gotten 2 checks for a total of $1900, pretty cooll.
4.
aStephen says:
April11, 2009 at 5:52 pm
Is this for real? I tried one thing and it didn't pan out. I made about $500 a month but that was 2 years ago. I'm going to give this a shot.
5.
aMary says:
April 09, 2009 at 1:33 pm
I think this is great and will come in really handy right now. I'm not the best computer user but I think I can post links!!! :)
6.
aDavis says:
April 08, 2009 at 9:16 pm
Just a quick notice about this thing. It does work but you have to be able to use a computer at least somewhat. If you can use email, etc. then you'll be fine.
7.
aMom says:
April 08, 2009 at 11:33 am
Holy cow Damo! Thanks for posting that screen shot, you just gave me the inspiration I needed. Wow! :-)
8.
aDamo says:
April 08, 2009 at 2:18 am
@Thomas, I'm using it now and it's working pretty well actually! I paid a dollar for shipping, got it in a few days, signed up for my Google account and have been cranking along ever since. My first week I made a whopping $288 and the second week I doubled that then it kinda snowballed to $300+ a day! I'm gonna grow this puppy as big as I can. Here's a screen shot of my Google stats, my wife is in shock.stats
9.
aThomas says:
April 07, 2009 at 9:11 am
Has anyone tried this yet? Looks promising.
10.
aWanda says:
March 31, 2009 at 9:47 am
I just got my first check for $2800.00 from Google! How cool is that it took about 2 weeks for me to get the first check.
11.
aSheila says:
March 21, 2009 at 9:52 am
Well, I'm definitely interested... this could be just what I need right now.
Leave a Reply
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Great Bookkeeping News For Eichler Home Owners!
by Stephanie
(Rohnert Park, CA)
Great Bookkeeping News For Eichler Home Owners!
Tim Bucholtz, of Tim Bucholtz Construction, has invented an improved Eichler siding machine. This new Eichler machine will make it much easier and inexpensive to upgrade your Eichler homes to current energy and structural codes.
This is great news for current Eichler home owners!
The ability to produce a better, thicker and higher quality look-alike Eichler siding for less money than the 1/2 inch thick siding previously available opens up two major and exciting upgrades:
1) Earthquake - Removing all your old siding and used up R-3 insulation will enable Tim to add needed upgrades to help you meet current earthquake codes. Earthquake upgrades such as more foundation bolts, earthquake hold-down brackets at critical weight bearing post areas, and nail plates at all beam-to-beam and beam-to-post areas to name a few.
These upgrades accompanied by properly nailed, thicker Tim Bucholtz siding, keeping with your Eichlers historical appearance, will go a long way toward protecting your family and investment should an earthquake occur!
2) Insulation - Installing up to current code new R-13 insulation, covered with a vapor barrier such as tyvac or 15 lb. tar paper, along with our new siding will also save you money on your utilities.
With the new insulation, you will see a great improvement in your heating & cooling costs as well as noise reduction for your Eichler home.
Knowing that each Eichler home is unique in it's own way with different obstructions such as pools, fences, gates, trees, and old phone & cable wires makes it necessary to schedule an on-site evaluation of each jobsite.
You can schedule an on-site evaluation of the jobsite with Tim Bucholtz himself, and he will give you an accurate, fair and FREE estimate for your new Eichler upgrades.
Having 20 years experience inside, outside and on top of Eichler homes in Novato, Lucas Valley and Terralinda lent way to Tim's invention and his being able to offer you the opportunity for these upgrades.
Below are a few notes of interest in helping you to consider hiring Tim Bucholtz Construction to upgrade your Eichler...
A. Licensed and Insured with 20 years of experience working on Eichlers.
B. All work to be done with permits and inspections - NO EXCEPTIONS!
C. All labor and materials supplied by Tim Bucholtz Construction carries a three year guarantee.
D. No work will start before 9AM or continue after 6PM, Monday through Friday.
E. Once work starts, progress will continue every work day, weather permitting.
F. All gates to backyards, swimming pools, etc. will be re-secured after each work day.
G. Unforeseen repairs such as dry rott, beam repairs, beam replacement, termite damage, faulty electrical, etc. will be brought to the owner's attention and repaired on a separate time and material basis not to exceed $65 an hour.
H. All work related debris will be removed and your property returned to its original condition.
I. References available upon customer request.
J. All materials provided by Tim Bucholtz Construction will be primed and calked at completion of job.
K. Contractor not responsible for breakage of glass or any interior damages such as popped sheetrock nails, fallen pictures, etc.
L. An attempt will be made to hide or get rid of unsightly coax cables and phone lines.
Questions? Comments? You can leave them here.
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