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Default On Credit Cards

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Every major U.S. credit card company, with the exception of one, charges a two to three percent foreign transaction fee when you use your credit card abroad. Until recently, many credit card companies did not clearly disclose these fees in their terms and conditions.

Earlier this year many people received a notice of a class action lawsuit settlement concerning these fees.Now that the lawsuit has been settled, credit card companies are required to clearly state foreign and international transaction charges on credit card applications.

You will most likely find that your credit card company charges three percent for all international transactions if you get in touch with their customer service. Paying an extra three percent on every purchase can really be hard, however, there are some ways to avoid paying for these charges.

Foreign currency exchange rates from your bank can be somewhat better than what you will get at a foreign currency exchange booth.

When a debit card is used as a credit card, there may be some risks, but ATM withdrawals are free of foreign transaction charges as a general rule. A credit card is easier to protect against fraud than a debit when making purchases abroad, so this is why it would be better to use a credit card abroad.

If some unscrupulous merchant overcharges you or uses you card fraudulently you can contest it and receive a refund. If your debit card was used fraudulently , you will not only be faced with an empty bank account, but you will find that it takes longer to receive any type of refund.

The no fee credit cards offer the best way to avoid paying international transaction fees plus they give the security of a credit card with no added fees.

It is always great to know just how much you will be spending in your day to day life, but it is even better when you are vacationing; ATM fees are charged for each transaction. Few people can tell exactly how much cash they will require while traveling , so unless you have a very precise budget it can be difficult to withdraw the correct amount in one single transaction. Sometimes it is hard to find a cash machine in many countries, so you have to be careful to not withdraw too large an amount to keep from being robbed. You have to pay fees to convert to foreign currency and then you also have to pay fees to convert back to your local currency.

There is a fee to purchase traveler's checks, and they are not accepted everywhere, however they do offer a secure alternative to cash as they can be replaced if lost or stolen.

Make sure you know what the terms and conditions are on a credit card you apply for thinking that it charges no additional fees for foreign purchases. If the card has a high rate of interest, be sure of the terms to know whether you can pay of the balance quickly so you will not have to pay extra fees of a different sort.

Default On Credit Cards

I rented a beachfront bungalow and worked on Paradise Island. Life was good?

Until one day I found out that I needed working papers to continue working and could not apply for them while I was living in the Bahamas.

When I was unable to secure working papers to continue working in the Bahamas, the work quickly dried up and my cash flow was abruptly interrupted.

I did what many red-blooded Americans do? Started Living on credit cards.

I was living near the beach, beautiful weather, beautiful women, fresh air, peace and quiet. It was a good life?

I was a Master at MasterCard?

Borrowing from one card to pay the bill on the next card. ?Until I maxed out ALL my credit cards and the cash dried up.

Then I became a Master of Financial Disaster.

I remember when the gas stove (which ran off of a gas tank) ran out of gas. It was $60 (which I didn't have) to refill the tank - so I just stopped cooking and only ate raw foods.

If you want to lose weight, just eat raw foods for months. Taste like crap but works like a charm. I lost lots of weight. I was skinny. Mainly because I ran out of money for food.

I remember one day only having one dollar to my name which bought me a small bag of potato chips and a soda. That was my meal for the day.

At about this same time my student loans were coming due. STUDENT LOANS? ?You gotta be kidding me.

I couldn't even afford food - The student loans would have to wait.

Guess what happens when you don't pay your student loans? Borrowers who fail to make a payment on time are considered delinquent on their loans. Deliquent student loans are trouble.

Student Loan Borrowers who don't make payments for 270 days are in default. Defaulting has severe and long-lasting consequences:

The Department of Education can immediately demand repayment of the total loan amount due.

The Department of Eduction will attempt to collect the debt and will charge collection costs.

And by the way, The Department of Education reports defaulted loans to national credit bureaus, damaging the borrowers' credit ratings and making it difficult for borrowers to make purchases such as cars, get a home mortgage or even rent an apartment.

- Borrowers with loans in default are ineligible for Title IV student aid.

- Borrowers with loans in default are ineligible for deferments.

- The Internal Revenue Service can withhold borrowers' Federal income tax refund, including your spouses'.

- Borrowers' wages may be garnished up to 15% of the Gross. Gross, not net!

- Borrowers with defaulted Federal Family Education Loans (FFEL) or Direct Loan Program loans (DL) may be liable for collection costs incurred to collect the loans.

If the holder of the defaulted loan, which may be either the U.S. Department of Education or a guaranty agency, retains a collection agency to collect defaulted loans, charges imposed by the collection agency may be added to the amount borrowers owe.

This means that the amount of the Student Loans may include collection costs of up to 18.5% of the principal and interest outstanding on the defaulted loan.

ALL OF THESE THINGS HAPPENED TO ME!

This is the end of Part 2 of a 4 Part Series Next Time: Credit Card Default

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Both Mary Bush & Carl Willoughby are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Mary Bush has sinced written about articles on various topics from SEO Articles, Finances and Finances. Get Out Of Rat Race Advices. Mary Bush's top article generates over 201000 views. Bookmark Mary Bush to your Favourites.

Carl Willoughby has sinced written about articles on various topics from Finances, Higher Education and Credit Cards. Carl Willoughby has worked as a Licensed Registered Representaive for the Prudential Insurance Company, as a Computer Programmer for the New England Telephone Company, as a Computer Salesman for SEARS and is self-employed as an Internet Marketing Consulta. Carl Willoughby's top article generates over 4400 views. Bookmark Carl Willoughby to your Favourites.

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