Ready to Rent provides participants with the information and resources to gain approval to rent safe and affordable housing. While 15 participants have already registered for this event, there is still room for 5 more.

Instruction will include information regarding landlord rights and responsibilities as well as tenant rights and responsibilities. We will cover budgeting and savings tips. Finally, participants will learn how their credit is scored. This is an important step towards repairing credit, as they will find out which accounts to begin with. Some participants find that some accounts can be removed for free, while others discover which negative accounts they should focus on first.

The Ready to Rent workshop series also partners with area landlords who participate in the program. Wake County Supportive Housing currently links qualifying applicants with more than 80 housing communities located throughout Wake County, many of which specialize in lower income requirements, subsidized rent and second chance credit programs.

When

Monday through Thursday, April 18-21, 2011 from 6:00 pm to 9:00 pm.

Where

AA Thompson Center, 567 East Hargett Street, Raleigh, NC 27601.

Register

Preregistration is required. A $25 fee may be paid to Wake County Supportive Housing which is due along with a completed application. Please contact Sharon Gibson with Wake County Supportive Housing at 919-856-5277 to register.

Location

Time

6:00 pm to 9:00 pm

Contact

For more information about the Ready to Rent workshop series as well as registration information for future classes, contact Sharon Gibson of Wake County Human Services at 919-856-5277.

What is a Re-age?

When a creditor re-ages your account, they agree to restore current status. This change in status provides multiple benefits.

First, you no longer are required to pay for arrears. Instead of catching up through sending in back payments in addition to your current month’s payment, you can now send one payment each month. This is important when your budget is already stretched.

Second, you can say goodbye to late fees. That $39 to $45 a month that you were getting charged as a penalty goes away when your account is current.

A third major benefit to an account re-age is that your creditors can now report your current status to the credit bureaus. While your late payments will still be on record for 7 years, your scores will jump when your current status is reported. This current status will outweigh older late payments in your credit report, which will allow your scores to continue to climb as long as you maintain that current status.

Major credit card companies are restricted in how often they can re-age an account. You should understand that you may only get a maximum of 2 chances over a 5 year period to re-age your accounts. Therefore, they will not make the decision lightly. They want to make sure that you are serious about maintaining your account.

When you enroll in a debt management program, it provides proof to your creditors that you are committed to getting back on track. They will compare your program summary with your credit report to make sure that you are enrolling all of your credit card accounts. If they see multiple accounts with balances left off the program, there is a possibility that they may deny benefits until you have added those accounts. That is why it is imperative that you include all of your unsecured debt for maximum benefit.

To see how re-aging through credit counseling can benefit you, imagine this scenario. You have a credit card with a $200 a month payment. If you miss a payment, your next month may require $447 as a minimum payment rather than your usual $200. This includes 2 months payments, additional finance charges on your higher balance and a late fee. If you dare fall 2 months late, your interest rate will skyrocket to 29.99% or more, depending on the penalty rate on your account.

By enrolling in a debt management program, your creditor can re-age your account. Instead of a $447 minimum payment, your new monthly payment might be $160. Your payment could be lower or higher than this example. Your new payment primarily depends on which creditors you owe as well as specific details on those accounts.

If you fail to receive credit counseling before your accounts are charged off as bad debts, you lose the right to a re-age as well as the other benefits of a debt management program, such as lower interest rates, reduced payments and a rebuilding of your credit rating. You only have a limited window to act. Once an account approaches 4-6 months late, you can expect your lender to provide final notice of charge-off. If you miss their ultimatum, you get to deal with the nasty collection agents that will pursue collection of the defaulted debt. For more information about re-aging your past due credit cards, contact our financial counselors today.

The credit course will be held at the South Wilmington Street Center in downtown Raleigh.  The class will be held on August 24th at 3:00 pm.

For more information and to register, contact Jimmie Watson with the Wake County Supportive Housing Program at 919-856-5710.

Time:

Location:

The workshops will introduce you to the components that affect your credit score.  Several credit scoring myths will also be addressed.

Times and Locations:

First Workshop: Wednesday, August 19, 2009, 1:00 pm to 4:00 pm.  For more information or to register, contact Terrie Deal with the Wake County Supportive Housing Program at 919-231-5957. This workshop is hosted by the A.A. Thompson Center:

Second Workshop: Wednesday, August 19, 2009, 6:30 pm to 9:30 pm. To register, contact Sharon Gibson at 919-231-5957 with the Wake County Supportive Housing Program. This workshop is hosted by Hollenden Place Apartments:

The class, along with the rest of the Ready to Rent workshops, will be held at the South Wilmington Street Center (see below for address).  The credit class will be held Wednesday, July 29, at 9:00 am.

The workshop will introduce you to the factors that determine your credit score and address several myths about what can improve and what can damage your credit.  Come learn why your credit is important, and how you can improve your score as much as possible.

Time:

Wednesday, July 29, 2009
9:00 a.m. to 12:00 p.m.

Location:

For more information and to register for the class, contact Jimmie Watson with the Wake County Supportive Housing Program at 919-856-5710.

Instead of repeatedly being denied decent housing because of negative credit marks in the past, you can get back on track to safe and affordable housing. The Ready to Rent program provides the following benefits for participants:

• Learn tenant rights and responsibilities
• Learn landlord rights and responsibilities
• Find out how to fix your own bad credit
• Get referrals for affordable housing

If you have had a history of credit problems or evictions, you might be able to get back on track with a little help.

Time:

1:00 p.m. to 4:00 p.m.

Location:

The 3 hour credit class will be provided by Vision Credit Education. Addition instruction focuses on budget and saving as well as on rental basics. To register, call Sharon Gibson with the Wake County Supportive Housing Program at 919-231-5957.

Up until just a few years ago, balance transfers normally incurred a 3% fee that was capped at $50. Now there is no cap, and the fee has increased to 5%.

Cash advances did not have such a fee until now. This up-front fee is also 5% of the cash advance, with a minimum fee of $10. In addition, there is still no grace period on cash advances, meaning that the higher interest rate for cash advances will begin accruing on that balance immediately. Additionally, Chase has quietly lowered cash advance limits on cards, with many reduced to the lower of 10% of the credit limit or $1,000.

For several years from 2003-2007, Chase actively encouraged its superprime customers to rack up large debts through very attractive balance transfer offers. While most were around 3.99% or 4.99%, some were as low as 1.99%.

The idea was that they would float these low interest balances for a few months until the cardholder did something to prompt a higher rate. They were hoping that enough cardholders would miss a payment so that they convert a certain percentage of these accounts into high-profit producers. A cardholder that missed a payment would see their interest rates hiked and would lose the “life of the balance” rates for good.

While these changes have affected a small number of account holders, a very high percentage of account holders never triggered interest rate increases. They were very careful to make their monthly payment so that they could retain the low rate. If they were ever unable to meet all of their monthly obligations, they would choose some other payment to delay. The Chase accounts would always be paid on-time.

Out of Balance Transfer Game

By making such moves to raise balance transfer and cash advance fees, Chase is betting that they will make enough money on upfront fees to offset any higher default risks. While some customers never read the fine print on an offer, most of their superprime customers do. That is why they have such good credit in the first place. These customers will likely balk at any new balance transfer offers that Chase presents to them.

The extraordinarily low rates that Chase offered previously will likely never be offered again given the regulatory climate that credit cards must operate in beginning in February 2010. By reducing the “any time any reason” potential for changing the terms on a credit card agreement, credit card issuers must pass on some of the lost profits to their best cardholders if they are to retain current profit margins.

There was a whole culture of consumers that took advantage of the low rates previously offered. Many of them used the offers to buy cars at below-market interest rates. Some were even as bold as to use these low interest offers as a sort of margin account in order to place investments that were expected to earn a higher rate than they were being charged by Chase.

While Chase encouraged such activity before, they certainly have put the brakes on this marketing strategy. In fact, the higher minimum payment requirements that they have placed on many of their account holders was expanded to an even larger percentage of their credit card portfolio.

Certainly Chase understands the negative public perception that accompanies such changes. However, they are also aware that those who are both writing and reading such infuriating comments are largely those that have already been affected by the changes. In short, the negative press has been fairly minimal given the sudden and shocking minimum payment hikes that have affected so many.

Regardless of public opinion, it certainly hasn’t hurt Chase profits. Chase reported quarterly results of $2.7 billion while CNN reported that most analysts projected a profit of $280 million. That announcement prompted the following quote from CNN:

JPMorgan Chase once again proved that it has been one of the better-run banks during the financial crisis after reporting quarterly results that blew past Wall Street estimates.

If there is good news for the consumer, it is that banks may be almost out of the woods in terms of consumer credit losses. Perhaps that will translate into better terms for cardholders that what the current economic climate has produced. Even if this occurs, it will not happen before February 2010 as provisions of the CARD Act are enacted.

The Ready to Rent series combines tenant education with consumer training. Participants that complete the workshop series are better prepared to make good financial decisions, understand their credit reports and make progress toward improving their credit.

Tenant education focuses on the rights and responsibilities of tenants and their landlords. Participants find out what to do to resolve conflicts over perceived breaches in their rental contracts.

Segments on budgeting and saving helps tenants prepare for unexpected expenses and recurring costs so that they can make sure their rent is paid on time each month. An emergency fund can be established with just a few dollars a week, which can quickly reach over $100 that can be used for emergency expenses.

Anyone with damaged credit or a history of evictions can benefit from this class because of the focus on credit repair. We teach how you can repair your own credit rather than use expensive credit repair companies. An improved credit score can improve your approval chances when submitting a rental application.

Time

Wednesday, June 10 from 1:00 p.m. to 4:00 p.m.

Location

To register for the event, please contact Terrie Deal with the Wake County Supportive Housing Program at 919-231-5954 or 919-856-5270.

CARD Act Background

The CARD Act of 2009 is one of the biggest regulatory measures to be enacted on the credit card industry. It essentially revokes the authority of credit card issuers to “police themselves” as they previously had claimed they could be trusted to do.

Credit card issuers had become the subject of a firestorm of criticism as consumers increasingly vented to their legislators about their frustrations with credit card policies. When President Obama met with the leaders of credit card issuers earlier in the year, it was apparent that the push from consumers would outweigh the voice of the powerful credit card lobbyists.

Members of Congress overwhelmingly approved the Act, with only Senators and Representatives from the credit card friendly states of South Dakota and Delaware dissenting. The President had already indicated his support for such a bill, and he had set a deadline of Memorial Day for signing it into law. The Act was signed on May 22.

CARD Act Provisions

The CARD Act severely restricts credit card issuers by limiting the types of term adjustments that can be legally made to existing and new credit card agreements. There will be some profound impacts to several segments of credit card users.

1. College Students: Credit card issuers may not send prescreened credit card offers to anyone under age 21 unless they have opted to receive such offers. Gifts such as T-shirts or frisbees may no longer be provided on campus as a reward for completing a credit card application. Contracts would require a cosigner for anyone under age 21 unless the applicant can supply proof of ability to repay any debt incurred.
2. New Applicants: Credit card issuers may not raise the interest rates on new accounts during the first year of account activity. Exceptions include variable rate adjustments, promotional periods of at least 6 months or if an account holder becomes 60 days past due. Fee harvester cards may not assess fees and other charges related to opening the account that total more than 25% of the total credit limit. New cards must consider the applicant’s ability to pay.
3. All Account Holders: Interest rate increases on new purchases must be announced with at least 45 days notice. Existing balances are protected from interest rate increases, with the exceptions of variable rate adjustments, promotional periods ending after 6 or more months or if the account becomes 60 days delinquent. Cardholders that opt out of new terms may repay the balances at the old terms over a 5 year period, or they could be required to pay an increased minimum payment so long as the principal portion of the payment does not double. Additional limits on penalty fees have been imposed which requires cardholders to opt into over-the-limit charging privileges. Accounts subject to a penalty rate increase must be reviewed every 6 months and issued a lower rate if the cardholder has been making on-time payments during the review period. Double-cycle billing is prohibited. Due dates also are fixed so that they fall on the same date every month. Cardholders have until 5pm on the due date to deliver a payment on-time. Credit limit increases must consider the applicant’s ability to pay. Additional payments above and beyond the minimum payment must be applied to the highest interest rate balance first.

Implementation

Two changes go into effect on August 20, 2009. First, card issuers must provide at least 45 days to notify the account holder of any changes in terms to their cardholder agreement. Second, statements must be sent at least 21 days prior to the due date. The rest of the changes will not be effective until February 22, 2010.

Effects on Availability of Credit

Account holders will likely continue to experience increases in their interest rates up until the date of implementation. While card issuers may certainly lower interest rates after that time period to retain their best customers, they will be severely restricted in raising rates to their other customers. Many account holders should expect some increases in their interest rates prior to  February 2010.

Consumers looking to establish credit may find it harder to open multiple credit accounts in a short period of time. The terms of these newer accounts will probably charge higher interest rates for purchases, making credit cards a less appealing choice for short-term credit. Credit limit increases are expected to slow down as card issuers must confirm a cardholder’s ability to repay a higher potential debt balance.

Many attractive rewards programs may be trimmed as card issuers attempt to preserve profitability. Some rewards programs may be eliminated while others may dilute the benefits. Expect to see rebates reduced.

Applicants aged 18-20 will have the hardest time gaining new credit. They will have to either prove their ability to make payments or supply a cosigner for the account. This is expected to cause average credit card balances carried by college students to drop dramatically over the next 5 years, which should ultimately produce more financially stable consumers in the marketplace.