How To Negotiate A Payment Plan

Your negotiating strength comes when the creditor or collections agency realizes that your only other option is probably bankruptcy, where the creditor will get much less, or nothing at all from you. It is in the creditor's best interest to keep you from filing bankruptcy. Here are some suggestions for negotiating with your creditors:

1. Communicate your problems

Let your creditors know about any financial setbacks you've experienced recently. Detail your difficulty such as a job layoff, death in the family, serious medical problems, car repossession, home foreclosure, etc. Your ability to negotiate is strengthened if a creditor realizes that the reason for your situation is due to a serious hardship.

2. Be firm when telling the creditor what you can afford. 

If you owe the car mechanic $1,000 but can only pay $600 over the next year - state that - and be firm. Don't be intimidated into offering more than you can honestly pay now. In addition, ask the creditor for a better deal than they initially offer. For example, if you're three months behind in your credit card payments and the bank agrees to waive interest on one month, ask them to waive two month's interest.

3. Be firm when you negotiate with a collections agency 

If a collections agency says they can only agree to your paying $100 on your account, and you can only afford $50, don't agree to pay the $100. A collections agency represents the creditor and must always check with their client when negotiating payments. The client may accept your lower offer.

4. Offer a cash settlement

If a creditor will allow you to pay off the debt in installments, he/she may be willing to settle for 50 -75% of the amount owed, if you make one lump sum payment.

5. Realize it is up to you to convince your creditors to accept the payment plan.

To be more persuasive, you may need to give your creditors certain information. Provide them a list of your monthly expenses, including your debts, and a proposed installment plan. There are three types of installment plans:

- The first is self-negotiated, where you contact your creditors directly.

- A credit counselor administers the second.

- The third is the wage earner's plan, or bankruptcy court-administered plan           

Getting Help With Mortgage Payments

Foreclosure can be a court process where the lender proves that the borrower is in default on payments. The court may require the borrower to pay the entire remaining mortgage. If the borrower does not pay, the court will issue a statement to foreclose on the mortgaged house. Foreclosure can also be non-judicial and not involve the courts.

Either way, if you are having a hard time paying your mortgage, do not run away. One option that you have is to arrange a meeting with the lender and tell them why you are having late payments. The lender might rethink your situation and might do one of the following: they might ask you to pay some of your normal payment and to slowly make up the late payments over the following months; or make a loan modification that will modify the contract that will both suit you. If you agree with the terms, the new contract will be made and the foreclosure process on your home will stop. Changing the loan terms is one of the best ways you can get help with mortgage payments to make them more affordable.

If the lender does not want to make an arrangement with you, ask for the help of foreclosure services. These foreclosure services can be seen in your neighborhood, in churches or on the web. These would normally give you expert advice, talk to the lender on your behalf or help with mortgage payments.

If you do not have any options, selling your house might be your best option. When someone buys your house, you can get the money to pay it to the lender. Then you can focus on finding another home for your family.

If nothing works, then declaring bankruptcy may be your only option. Be sure to check with a good bankruptcy attorney to see what your options are. Filing a chapter 13 bankruptcy allows you to keep your home but there are certain qualifications for that type of bankruptcy. This is also a way to get help with mortgage payments so that they are affordable for you. Chapter 7 bankruptcy will wipe out your debt with your lender but you will have to leave the home.

If you are facing foreclosure, do not try to avoid all the notices. Instead, face your problems. It may not guarantee that you can get back your home, but you will be better prepared for what lies ahead.           

Car Loan Payment Calculator

The best way to determine what you next car loan will cost you is to go online and find a useful car loan payment calculator. This tool works if you are looking to buy a new or used car or if you are trying to refinance a car you already have. The tool is quite simple but can help you determine what you can afford or if refinancing will save you any money. Here are the steps you take in using a car loan payment calculator:

First - make sure the calculator you choose is one that will help you. It should have you input three to five items to get an accurate payment. The first thing it will ask is how much are you trying to finance.

Second - some calculators will ask for the amount of down payment you are planning on. If the calculator you find does not ask for this, then go to step three. If it does, enter the amount you are planning to put down. Remember that a down payment is usually required.

Three - determine how long you want to finance your car loan. The most common term today is 72 months but many borrowers finance shorter than that. Many times that will be determined by the lender and will be determined by the vehicle you are buying or refinancing

Four - last but not least is the APR or annual percentage rate. If you don't know what that will be, you can estimate on what you are expecting from the lender.

Once you have input all of this information into the car loan payment calculator, you can then see your estimated payment. These calculators are used for illustrative purposes only and may not be reflect the exact payment you will have. They will give you a very accurate estimation on what to expect. You can find a useful calculator here.           

Business Credit Card Payment Processing Solutions

Every business that sells goods and services online requires some form of credit card payment processing. Online payment services are similar to an offline merchant account. When the purchaser enters his details online, the credit card details are passed through an encrypted gateway, authenticated and the funds are transferred to the sellers account. This seamless process is the very foundation that ecommerce is built on. To accommodate international funds transfer, a plethora of different merchant services have arisen. Each of these services differs slightly. Just what are the key types and differences in online credit card payment processing servicesall

PayPal: PayPal is a payment alternative that is available to facilitate transactions in a diverse range of countries and currencies. Users are required to setup an account and verify their credit card details. They can then purchase goods and services through websites that provide PayPal shopping carts. Merchants that use this service do not need to interface with a bank account. The funds are held within the merchant PayPal account and can be transferred to the merchant FFFDs bank account. If the business is conducted in a foreign currency, currency exchange rates are applied to balance transfers. The advantage of this service is that it is quick to setup and does not require programming experience to establish a payment gateway to the merchants bank account. There are no fees to setup this process and transaction fees are cost-effective for low volume transactions.

3rd Party Solution Providers: Companies such as 2checkout.com provide an internet credit card payment processing service that operates in a similar fashion to PayPal. The advantage of this service is that it supports a wider variety of credit cards. The fees are slightly higher than PayPal and merchants are required to pay a one time activation fee. Funds are held in the merchants 2checkout account and can be transferred to a bank account when required.

Google Checkout: This service is provided by Google and is available only to merchants within the US and UK. Although Google plans to expand this internationally, they have not provided any further details on where and when. The advantage to merchants that qualify is the fee free period that extends into 2008.

Bank Merchant account: Your local bank can usually provide a payment processing service or recommend an authorized solution provider. Bank merchant accounts are usually an advantage to high volume transaction businesses because the processing fees are lower. They usually charge a setup fee and ongoing monthly fee. The service becomes more cost-effective to a business after a certain volume of transactions have been reached. The downside of this option is that it can require programming knowledge to setup the online payment gateway. Unless you have an in-house programmer or use the services of a programmer, the above solutions are usually preferred by web merchants.

This is a basic summary of some common services for processing credit card payments. You can find out more about each service by visiting the respective web site.           

Electronic Check Payment Processing

The processing of electronic checks is performed much like paper checks. Electronic check payment processing involves the use of electronic checkbooks. An electronic checkbook is a device in the nature of an electronic token. It contains encryption related tools, certificates, public and private key pairs, check processing software unlocking utilities, and those that perform other functions. It also can help maintain the log of transactions securely.

Whenever electronic check payment processing transaction is to be initiated, a blank electronic check appears on the payer's screen. The memo field, the date field, and the amount are all filled-in. The step to make the signature on the e-check involves insertion of the electronic checkbook into the check reader. The check reader is a check processing machine. The payer then needs to unlock his checkbook by entering the PIN. The serial number of the electronic check is automatically filled in by the checkbook device.

The entire check is read by the reader and then the digital signature is attached. The log from the data in the electronic check is maintained and the copy of the signed electronic check can be stored in record by the originator. The digital signature can be validated at any time by online verification for authentication of the source.

The automated clearing house (ACH) network provides for inter bank clearing of electronic payments for participating banks and other financial institutions. The ACH operator sorts ACH files that are received from member banks according to paying bank and originating bank branches. Totaling of the accounts is performed and the accounts of member banks are credited or debited accordingly.

ACH operations are performed batch wise. Money transaction completion generally takes a maximum of 72 hours. In case of insufficient funds in the payer's account, a return notification is sent back to the originating bank branch.

National Automated Clearing House Association (NACHA) rules related to the operation of electronic ACH check processing place the responsibility on businesses of their own customers' identification authentication. Some other responsibilities of businesses include having in place systems for verification of routing numbers, security encryption, and annual security audits.

ACH based electronic check payments made through the Internet have grown steeply over the last few years. Electronic check payment processing is cheaper and faster than that of paper checks.

Electronic check payment processing makes use of Financial Service Markup Language (FSML) to structure documents. It also makes use of digital signatures for identification of the check signing account holder. Private and public keys help in the verification of the identity of the account holder.

The benefits of electronic check payment processing lie in avoiding the paper check cost. Since electronic check payment processing is faster than that for paper checks, the profit margins of banks is expected to improve on account of more turnover of transactions. Further, it helps in reducing data entry errors and saves the time of human resources.           

Auto Insurance Payment Options

When you purchase an auto insurance policy, you are usually presented with one or more payment options. You will be presented by your insurance agent a price for the total policy, usually six months worth, and there will be a difference in price whether your pay the premium all at once, or break it out monthly. There are advantages and disadvantages to each payment option.

Paying the premium all at once is the most cost-effective option. The total premium price is lower if you pay all at once, and the added advantage is that for that entire policy time period, you do not have to worry about paying your car insurance. You already paid it all at once. You're all paid up for that amount of time. That's six months to a year that you have that part of your life covered. Depending on your rates, however, this option can be price prohibitive. Who had more than a thousand dollars at a time to spend in one popall If you do, this is the best option for you.

Paying the premium monthly is your other option, but there are ways to make this option more convenient, and to make it save money for you. For instance, once you're quoted a price for your premium, you can negotiate to pay a higher monthly premium over a shorter amount of time. This will look good to the insurance company, and it will get your premium paid faster, so that you can have several months where you don't have to worry about paying. Sometimes, though, this is still not an option. Funds can be limited, and sometimes you only have a small amount of money to work with every month. This is when you pay your minimum monthly amount for your auto insurance premium.

If your only option is to pay the minimum monthly premium, it is wise to set up an automatic withdrawal of the premium. Insurance companies are a lot more comfortable dealing with you that way, as they have some assurance of payment, and know that you have a valid bank account with which to pay your premium. The only trick there is to make sure that you have enough money every month for them to take the money out so that your account does not go into overdraft. If that happens and your payment fails to go through, you are at risk of having your insurance lapse, which jeopardizes your driving rights and your very freedom.

If you have no bank account, some insurance companies will allow you to pay monthly with a money order or cashier's check. If this is your choice of payment, it is imperative that your money order or cashier's check reaches the insurance company well in advance of your payment due date. Otherwise, you will be spending a lot of time on the telephone, trying to convince your insurance company to let you keep your policy intact.

Overall, no matter what your situation, it is helpful to work with an insurance broker. The insurance broker can help you figure out the best policy for you, but can also go over all your different payment options, and sometimes will accept cash to make your payment for you.

Having auto insurance is necessary if you drive, so make sure you pay the piper accordingly.           

Minimum Payment Due

If you take the Minimum Payment Due as displayed prominently in your credit card statements seriously you are likely to be in serious trouble.

Minimum Payment Due (MPD) is at the most only 5% of your total outstanding balance on the card meaning that your total dues are twenty times to that of what you are asked pay a month. If you decide to pay only that you enter into a never ending cycle of revolving credit. The interest charges per month will eat up nearly half of your MPD payment depending on the size of the balance and so your payment will cover only about 3% of total dues. As you have to continue using your card for necessary purchases every month your total dues are likely to increase every month despite your MPD payments and so are the interest charges.

Credit card issuing banks know too well how to lull you into a cycle of revolving credit. They tell you to pay only the MPD because they know you can always afford to pay that paltry amount.

You have to get over that feeling of euphoria of being able to pay the MPD every month. You must focus on your total payment due and ponder over how to go about it. If you clear the full amount nothing like it because that way you can avoid paying any interest and if you time your purchases just after the date of your card statement you can get an interest free period of up to 50 days. If that is not possible then you should decide the maximum amount you can pay. One nice thing about credit card payment is that you can choose any amount of payment every month. If you clear a sizeable amount of your outstanding dues you immediately save interest charges on that amount.

You need to do some more calculations. If you go for a personal loan to clear your card outstanding dues you may, in fact, be paying more interest. For example, let us assume your outstanding is 1000 bucks and your rate of interest is 10%.  Your equated monthly installments (EMI) will be arrived at by taking the loan amount plus the interest charges for the period. If you go for 12 months you EMI will be about 92 bucks. So, in effect, you have prepaid 100 bucks for interest. Now, if you clear that amount through 2 or 3 credit card monthly payments you can immediately see the interest amount you can save though credit card interest rate is higher. You have to remember that though interest rates are higher on credit cards these rates are calculated on daily reducing balance and so you can always try for optimization. You can also see that personal loan repayment tenure is never less than 6 months.

If you aim to manage your credit cards efficiently never even look at the Minimum Payment Due. Else it's only MAD(Minimum Amount Due)ness!