Thoughts, Ideas, and Concepts by Sandra Parks

Archive for February, 2010

NEW CREDIT CARD RULES IN EFFECT 2-22-2010

Unexpected rate hikes. Over-limit fees. Double-cycle billing. Those are just a few of the credit-card practices that have trapped millions of consumers into a life of constant worry over mounting debt. In less than a week, these practices will be history.

Unexpected rate hikes. Over-limit fees. Double-cycle billing. Those are just a few of the credit-card practices that have trapped millions of consumers into a life of constant worry over mounting debt. In less than a week, these practices will be history.

Exceptions, Caveats, Loopholes:

• Rate hikes are allowed if you’re more than 60 days late with a payment.
• Some banks have already found a way around the rate-hike issue, by increasing card users’ regular interest rates to as high as 29.9% and then refunding a part of that rate for each month that the customer pays on time.
• Double-cycle billing, although prohibited, can technically still exist for credit cards that don’t have grace periods.
• Issuers have been calling consumers asking them to opt in for over-limit fees in exchange for lowering that fee, says Chi Chi Wu, a staff attorney with the National Consumer Law Center, a consumer advocacy group. What they’re not saying is that if people don’t opt in, the transaction will be denied and they will not be charged over-limit fees in the first place, Wu says.

Billing Statements, Payments and Disclosures

• Billing statements must be sent 21 days before the due date.
• Your due date should be the same date each month.
• Payments are considered on time when received by 5 p.m. on the due date or the next business day after a holiday or weekend.
• Payments above the minimum must be applied to the highest-rate balance first.
• Each monthly statement must include information on how long it would take you to pay off your balance if you make minimum payments only and the total you’ll pay, including interest and principal; and how much you need to pay each month in order to pay off your balance in 36 months and the total you’ll pay, including interest and principal.
• Statements must also include a warning that by making only minimum payments you will pay more interest and it will take you longer to pay off your debt, as well as a toll-free number to call if you want to be referred to a credit-counseling service.

Exceptions, caveats, loopholes:

If you make a purchase under a “deferred-interest” plan (such as “No interest for six months,” for example), the company may let you choose to apply extra amounts to the deferred-interest balance. Otherwise, for two billing cycles before the end of the promotional period, your entire payment must be applied to that balance. Carrying a “deferred-interest” balance is a risky proposition altogether, says Wu: Unless the balance is paid in full over the specified period, the company will charge all interest retroactively once the promotional rate expires. “We think deferred-interest plans should have been banned,” Wu says.

College Students and Young Adults

• No credit cards for college students unless co-signed by a parent or they can demonstrate “ability to pay.”
• No credit-limit increases if you are under 21 and have a co-signer without that co-signer’s permission.
• No credit-card marketing and freebies on college campuses.

Exceptions, Caveats, Loopholes:

• Issuers will likely start appealing to parents to co-sign their children’s credit cards. And the Federal Reserve has specified that issuers have the option of keeping the parent on the hook even after the young person turns 21, Wu says. “If that younger person keeps the credit card for 20 years, the co-signer is liable that whole time.”
• Issuers are not allowed to give out freebies for signing up for a credit card on or near a campus — which still allows them to set up shop near popular off-campus venues and offer freebies to everyone, whether or not they apply.

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Hump Day Fallacies!!!

Job Search

The concept of “hump day” has had a long history – too long, in fact. 

For many years employees and managers alike have talked about the importance of getting through hump day (aka Wednesday) and making it to the weekend. Unfortunately, hump day is a career killer. 

Hump-day employees look at every week as the process of starting at the bottom of the hill on Monday morning at 8 a.m., climbing to the top by Wednesday at noon, and then coasting down to the bottom of the hill by 5 o’clock on Friday. These people haven’t gotten anywhere during the course of the week. They are back where they started on Monday morning, week after week after week. 

Imagine a college athlete who performs exactly the same way at the beginning of every season. Those kinds of players never get off the bench, assuming they can even keep their spot on the bench. Intuitively, we know we must continually improve if we want to take our careers to the next level. With a hump-day approach to the workweek, we sabotage productivity and psychologically set ourselves up for a mediocre week and a mediocre career. 

Study Warren Buffett, Steve Jobs, Oprah Winfrey and a host of other great achievers. They didn’t push forward for 52 working hours and then slump backward for another 52. They raised their bar of achievement, and then set the bar higher again and again. 

Instead of working for the weekend, try filling out a “Leap-Day Worksheet” at noon Wednesday. (Maximum time investment: 35 minutes.)

1.      Make a list of the meetings/activities /events that have occurred so far this week.

2.      For each entry in Step One, answer these five questions in less than five minutes:
a.       What did I do that was effective? 

b.      What did I do that was not effective? 

c.       What could I have done to be more effective? 

d.      What did I learn from this experience? 

e.       How can I use what I learned to perform at a higher level for the remainder of this week? 

From now on, make Wednesday at noon your weekly inflection point to capture key lessons and catapult to a higher level of performance over the remainder of the week. After all, the greatest performers in history didn’t rise briefly and then fall backward. They leapt forward to higher and higher levels of achievement, and hit repeat.

Cowboys back in the News Again!!!

A woman claims in a lawsuit filed only days before the Super Bowl that former Dallas Cowboys star Michael Irvin sexually assaulted her at a South Florida hotel, an allegation labeled a false attempt at “civil extortion” Friday by Irvin’s attorney.

The woman, identified only as “Jane Doe,” filed the lawsuit Thursday in Broward County Circuit Court seeking unspecified damages for the assault that allegedly occurred July 4 or 5, 2007, at the Seminole Hard Rock Hotel & Casino in Hollywood.

The incident was reported to Seminole tribal police on July 20, 2007, but the woman later signed a waiver of prosecution, Seminole tribe spokesman Gary Bitner said.

“I think she just wanted to put this behind her,” Bitner said. The case was referred to state prosecutors.

Ron Ishoy, a spokesman for the Broward State Attorney’s office, said the matter remains under investigation but no charges have been filed. Because the woman waited more than two weeks to report the incident, there was no physical evidence or hotel surveillance video, Bitner said.

Irvin, 43, is a member of the pro football Hall of Fame who starred at wide receiver for the Cowboys from 1988 to 1999. The Fort Lauderdale native was also a star in college for the University of Miami, playing on the Hurricanes’ 1987 national championship team.

Irvin is now an analyst for the NFL Network. His attorney, Larry Friedman of Dallas, said he was approached by the woman’s attorney shortly before Irvin was to appear on last season’s “Dancing With The Stars” competition.

The offer, according to Friedman: Irvin must pay the woman $1 million or a lawsuit would be filed to coincide with the Super Bowl, which is being played Sunday in Miami.

“I call it civil extortion: pay us or we’ll ruin your life,” Friedman said. “Nothing happened. There was no encounter between this Jane Doe and Michael Irvin. The entire story is false, it’s bogus, it’s made up.”

The woman’s Florida attorney did not immediately respond Friday to a phone call and e-mail seeking comment.

NFL Commissioner Roger Goodell, speaking at a Super Bowl news conference Friday, said he was not aware of the assault allegation. The NFL Network is a part of the football league.

“We’ll obviously take it seriously, make sure we understand the facts and then take the appropriate steps,” Goodell said.

According to the lawsuit, the woman claims Irvin got her drunk and took her to his hotel room where he and another, unidentified man insisted on sexual favors. The woman claims Irvin raped her and the other man forced her to perform oral sex.

Irvin has had previous brushes with the law, including a no-contest plea to a cocaine possession charge in 1996. Later that year, Irvin and another Cowboys player were accused of sexual assault by a woman, but an investigation found the story was false and the woman recanted.

Do you have these items in your home?

The kitchen is still king.

LAS VEGAS — Americans want smaller houses and they are willing to strip some of yesterday’s most popular rooms — such as home theaters — from them in order to accommodate changing lifestyles, consumer experts told audiences at the International Builders Show here this week.

 

“This is a traumatic time in this country and the future isn’t something we’re 100% sure about now either. What’s left? The answer for most home buyers is authenticity,” said Heather McCune, director of marketing for Bassenian Lagoni Architects in Park Ridge, Ill.

Buyers today want cost-effective architecture, plans that focus on spaces and not rooms and homes that are designed ‘green’ from the outset,” she said. The key for home builders is “finding the balance between what buyers want and the price point.”

For many buyers, their next house will be smaller than their current one, said Carol Lavender, president of the Lavender Design Group in San Antonio, Texas. Large kitchens that are open to the main family living area, old-fashioned bathrooms with clawfoot tubs and small spaces such as wine grottos are design features that will resonate today, she said.

“What we’re hearing is ‘harvest’ as a home theme — the feeling of Thanksgiving. It’s all about family togetherness — casual living, entertaining and flexible spaces,” Lavender said.

Paul Cardis, CEO of AVID Ratings Co., which conducts an annual survey of home-buyer preferences, said there are 10 “must” features in new homes.

1. Large Kitchens, With an Island

“If you’re going to spend design dollars, spend them where people want them — spend them in the kitchen,” McCune said. Granite countertops are a must for move-up buyers and buyers of custom homes, but for others “they are on the bubble,” Cardis said.

2. Energy-Efficient Appliances, High-Efficiency Insulation and High Window Efficiency

Among the “green” features touted in homes, these are the ones buyers value most, he said. While large windows had been a major draw, energy concerns are giving customers pause on those, he said. The use of recycled or synthetic materials is only borderline desirable.

3. Home Office/Study

People would much rather have this space rather than, say, a formal dining room. “People are feeling like they can dine out again and so the dining room has become tradable,” Cardis said. And the home theater may also be headed for the scrap heap, a casualty of the “shift from boom to correction,” Cardis said.

4. Main-Floor Master Suite

This is a must feature for empty-nesters and certain other buyers, and appears to be getting more popular in general, he said. That could help explain why demand for upstairs laundries is declining after several years of popularity gains.

5. Outdoor Living Room

The popularity of outdoor spaces continues to grow, even in Canada, Cardis said. And the idea of an outdoor room is even more popular than an outdoor cooking area, meaning people are willing to spend more time outside.

6. Ceiling Fans

7. Master Suite Soaker Tubs

Whirlpools are still desirable for many home buyers, Cardis said, but “they clearly went down a notch,” in the latest survey. Oversize showers with seating areas are also moving up in popularity.

8. Stone and Brick Exteriors

Stucco and vinyl don’t make the cut.

9. Community Landscaping, With Walking Paths and Playgrounds

Forget about golf courses, swimming pools and clubhouses. Buyers in large planned developments prefer hiking among lush greenery.

10. Two-Car Garages

A given at all levels; three-car garages, in which the third bay is more often then not used for additional storage and not automobiles, is desirable in the move-up and custom categories, Cardis said.

Will your student loans be forgiven??? That is the Question!!!!

If you’ve got a diploma hanging on your wall, chances are it didn’t come cheap. About two-thirds of the 3 million or so college seniors who donned a cap and gown this year took on an average debt of $22,500 for the privilege of earning that diploma. The debt graduate and professional students incur is often tens of thousands more.

As graduates struggle to find jobs during the worst economic crisis of their lifetime, an adviser to the secretary of education expects a rise in the default rate on student loans, which cannot be easily renegotiated or discharged in bankruptcy.

But a provision of the College Cost Reduction and Access Act of 2007 that reduces monthly payments for hundreds of thousands of borrowers who qualify for the new Income-Based Repayment plan took effect July 1.

Borrowers who work in certain public service jobs could also have the balance of their loan erased after making qualifying payments for 10 years. (Supposedly, this costs the government nothing, since it will now change the way it subsidizes student-loan lenders.)

So, will your student loan be bailed out? In a word: maybe.

At the very least, the IBR program will lower the monthly payments of people who accumulated significant federal student loan debt but don’t have the income to make the payments on the standard 10-year repayment plan. This relief may reach as many as 1 million people, according to the Project on Student Debt. And despite lower payments, the former students won’t be paying off their loans indefinitely — any remaining balance will be forgiven after payments are made for 25 years.

Basing loan payments on income isn’t a new concept. For years, graduates with federal student loans had options to reduce or eliminate their payments, depending on how much money they made. But IBR is intended to be more generous.

IBR caps monthly payments at 15% of earnings above 150% of the poverty line, or $10,830 for a single-person household. Online calculators at the free public service site FinAid.org can help you compare what your income-based payments, income-contingent payments and income-sensitive payments would be.

There are situations in which an IBR payment would be zero. If your payment is so low it doesn’t cover the interest accruing on your loan, the government will pay the interest for three years on subsidized Stafford loans, which are government-backed loans given to financially needy students that do not accrue interest while the borrower is in school.

After that period, and for all of the other kinds of unsubsidized federal loans, unpaid interest will accrue but will not compound. In other words, you won’t be charged interest on top of interest.

Borrowers who think they could benefit from IBR should contact their lender and ask for an application that will authorize the release of their adjusted gross income from the Internal Revenue Service each year.

The news is even more promising for people working in public service jobs: government employees, teachers in public schools and universities, workers at public hospitals and anyone working for a 501(c)(3) nonprofit would qualify. Anyone working in a qualifying job who borrowed from the Direct Loan Program is eligible for loan forgiveness after 10 years, down from 25.

To qualify for forgiveness, borrowers who work in a public-interest position must either have an existing Direct Loan or consolidate a federal loan with a private lender into the Direct Loan Program and make 120 payments after Oct. 1, 2007. The payments do not have to be consecutive, can be made while at different eligible positions and must be made on the income-based or standard repayment plans. (See “Ask for student loan forgiveness.”)

At this point, the burden is on borrowers to document where they were working during their repayment period. The Department of Education is planning to develop a more definitive system to confirm eligibility, but right now borrowers should keep pay stubs and tax documents that verify their work history.

IBR and public-loan forgiveness won’t be the best options for every borrower. Some borrowers — those able to make higher monthly payments — would be better served by sticking with a traditional payment plan to avoid accruing years of additional interest. Graduates who financed their education with private loans are ineligible entirely.

But for an MBA grad who borrowed $150,000 planning to be an investment banker but ended up in government service, IBR will result in payments that are affordable on a civil servant salary.

When will it end?

Racism runs amuck over in Europe still and if you don’t believe us, ask Italian player “The Gooch,” Mario Balotelli and US midfielder DaMarcus Beasley.

DaMarcus Beasley’s car was just blown up outside of his home in Glasgow, Scotland.

United States midfielder DaMarcus Beasley’s BMW has been set on fire outside his home in Glasgow. The incident happened Monday in the Scottish city. Beasley said Wednesday on Twitter that “someone blew up my car.” He added that he was “glad no one got hurt.” Strathclyde Police says it is treating the incident as “willful fireraising” and that inquiries are ongoing.

Another player, Balotelli, is still going through racism in the Italian Serie A. Rival team, Juventus, has had fans suspended this year because of racist chants to the youngster.

DaMarcus plays for the hometown team in a totally different league! Will racism ever desist?

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