Credit News

Credit News

30-Yr. Fixed Mortgages Hit Record-Low 3.4%

Just when I was beginning to think interest rates were finally bottoming out, rates on 30-year fixed mortgages dropped again to an all-time low of 3.4 percent last week. According to a press release issued by Freddie Mac last Thursday, "all mortgage products, except the 5-year ARM, averaged new all-time record lows."

Tax Form 1099-C: IRS Implications of Charged-Off Credit Cards

If you’re anything like me, your stomach drops when you receive any form of communication from the IRS. That’s because if they’re sending you something in the mail, it's most often because you owe some clams to Uncle Sam. Inevitably, the government finds ways in which to squeeze revenues from as many angles as possible, especially with today’s trimmed public budgets and high government debt. In fact, credit card holders have often been the recipients of such attempts at increasing the public coffers.

Would You Pay Extra to Use Your Credit Card?

It's always the consumer that gets hosed in the end. In case you haven't heard yet, Visa and MasterCard recently reached a hefty settlement with a number of retail groups as a result of a class-action lawsuit initiated back in 2005. Not only will Visa and MasterCard pay over $7 billion to these retail groups, but part of the agreement gives merchants the ability to charge consumers an additional fee for using credit cards to make purchases. Wonderful.

Fed Says Fewer Americans Carry Credit Card Balances

The Fed's most recent Survey of Consumer Finances was released earlier this week, and in spite of all the negative reports concerning shrinking incomes and net worth, it actually contained some tidbits of positive news regarding credit card debt. They're hard to find among all the other depressing information, but hey, I'll take what little good news we get these days!

Auto Sales Up on Easier Credit

auto sales

Auto sales were up nearly 30 percent in May over the same month last last year. Meanwhile, the stock market saw its worst month in two years, consumer confidence weakened, and unemployment rates were still pitiful.

Yet, in spite of all the negative news, for some reason Americans ran out and snatched up 1.3 million cars and trucks. Why?

Capital One Discontinues Orchard Bank Credit Cards

If you haven't heard yet, Capital One announced that it closed on the purchase of HSBC's U.S. credit-card business earlier this month. Capital One paid a little over $31 billion in cash and received just over $28 billion in credit card receivables following the acquisition. It really was a win for HSBC as they desperately wanted out of the volatile credit card business in the U.S., and it also happened to be a perfect strategic fit for Capital One who continues to aggressively grow its domestic credit card portfolio. Part of the deal included HSBC's well-known Orchard Bank credit cards too, which have consistently ranked for years among the best credit cards for people with bad credit. If you have great credit scores, you've probably never even heard of this card. However, you would be hard-pressed to find anyone with bad credit who hasn't at least considered an application for an Orchard Bank credit card at some point in time.

Would You Pay the Mortgage or Credit Cards?

Here are some interesting credit facts to contemplate while you take your Friday-morning coffee break. Prepare yourself, because I know you're excited! According to TransUnion's most recent Credit Risk Index (CRI), the amount of credit risk taken on by consumers is rising for the first time since its peak in 2009, and the driving factor is mortgage delinquency. Apparently the numbers of homeowners who were at least 60-days late on their mortgage began to rise again during the 4th quarter of 2011. Check out the chart below which shows how the CRI has moved since 2005.

62% of Adults Don't Check Credit Reports

Each year I look forward to checking out the National Foundation for Credit Counseling's Consumer Financial Literacy Survey. The NFCC has been sponsoring this report for six years now, and the results are generally released around the beginning of April in recognition of National Financial Literacy Month. As in previous years, the 2012 Consumer Financial Literacy Survey includes some pretty alarming statistics surrounding credit reports and credit scores. Here's what really caught my eye as I perused the key findings in this year's report.

IRS Says Credit Card Sign-Up Bonuses are Taxable

Before you begin cursing the IRS for trying to dig even deeper into your pockets, let me make it clear that the tax law hasn't changed. Traditional rewards earned by making purchases with credit cards are still considered tax-free. You can rack up as many points as possible on your purchases without worrying about a 1099-MISC for the value of the rewards mysteriously showing up in the mail. - Scan and Charge Credit Cards on Your Smartphone

Leaps in technology generally don't obliterate older methods overnight. As you might imagine, there are often transitional developments which help to act as bridges from one generation of technology to another. We're currently seeing this take place in the auto industry as we work to move away from fossil fuels and into something more sustainable. Likewise, we're seeing a huge transition take place in the credit card industry. Soon, NFC chips will most likely replace our current standard wallets. But until that shift actually occurs, we’ll continue to see technologies like Square and become transitional players in the industry.


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