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DEBTSMART EMAIL NEWSLETTER - Tools for financial success!
A Free E-Mail Newsletter from DebtSmart Online and Press One Publishing.
ISSN 1538-6740
September 26, 2001 Issue 9
Scott Bilker, Editor and Publisher, mailto:publisher@debtsmart.com
Richard Crammer, Editor, mailto:editor@debtsmart.com
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For instructions to SUBSCRIBE, and DISCLAIMER, see bottom of this email.

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IN THIS ISSUE
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=> Advertisers

=> Note from the Publisher

=> Cool Debt Statistic

=> DebtSmart Resources

=> Reader Q & A: Car Dealers

=> Frightening Future

=> Credit Card Savings

=> Make "Lemonade" From a Lemon

=> Looking For the Best Mortgage?

=> Subscribe/Disclaimer Information
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We have done our best to ensure that all advertisers included in the DebtSmart Email Newsletter offer quality products and services. However, if you have any problems, please let us know by sending mailto:comments@debtsmart.com

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DEBTSMART EMAIL IS BROUGHT TO YOU BY THE FOLLOWING ADVERTISERS:

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Note from the Publisher

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  Please, help support victims and rescue workers: 
 
  LIBERTY UNITED -- http://www.libertyunited.org  
  RED CROSS -- http://www.redcross.org 
  SALVATION ARMY -- http://www.salvationarmy.org  
  NY FIRE FIGHTERS -- http://www.firedonations.com  

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COOL DEBT STATISTIC
Source: Consumer Federation of America

In the first half of 1997, credit card solicitations were at a record level. The second quarter mailing of 881 million was the highest on record. From 1995 to 1996, credit card telemarketing expenses rose 30% (from 18.6 to 24.1 million hours). From 1995 to 1996, credit card ad expenses rose 14%.

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DebtSmart Resources

How to advertise in the email newsletter:
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How to advertise in the online classifieds:
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DebtSmart Books, software, reports, in-print and downloads:
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Archive of DebtSmart Email Newsletters online:
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Reader Q & A: Car Dealers
by Scott Bilker

The following is a response to the excerpt from my book, "Credit Card and Debt Management" that was included in the last email newsletter.

QUESTION:
I know that you have used these examples to help people learn and to be aware but you have also just made every car dealer in the country a crook.

I grew up in a family that owns car dealerships and have been working here for a number of years. I have been in the finance and insurance office for 3 1/2 years and have never quoted insurance or extended service plans in a final payment without first explaining what it is and letting a customer decide the type of plan they want.

Secondly, because of disclosure laws, your father and friends would have had to sign separate forms for credit life, disability, and extended service plans giving them yet another opportunity to change their minds, and yet a third opportunity exists. You can cancel any one of those plans within a time period without any financial obligation.

Now, I'm not saying there aren't dealers out there doing exactly what you experienced and I'd never tell a car buyer to not be aware, but I think people should go looking for an honest dealership that exists on its integrity rather than to force a bad dealership to comply.

By giving the corrupt dealership your business, even if you get them to comply, still allows them to make money and stay in business. --Heather

ANSWER:
Personally, I have yet to buy a car from a dealer that I considered being "totally" honest. Every situation I've been involved in, when buying a new or used car, has resulted in some type of attempt to get me to pay more.

You mention how people have to sign separate forms for credit, extended service plan, etc. However, it doesn't matter what extra papers you sign if you don't know what they mean or their true costs.

In my father's case, without my being there, he would have signed any documents they gave him! Sure, he has 72 hours to back out of the deal but it doesn't matter because he never would have reviewed the details.

I once attended a class in negotiation. The instructor told the class that when you enter negotiations you should always tell the truth, with one exception...

Click the below link to read the rest of this article:
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Frightening Future
by Gary Foreman

Dear Dollar Stretcher, War is on the horizon. What should we do to prepare ourselves? I was a young teenager during most of Vietnam and I didn't have to make the financial decisions for my family. What do I need to know in order to plan for this frightening future?
--Wendy W

Good question. How can we prepare for uncertain times? As a long time Florida resident, I think that hurricane preparation could provide a good example.

At the beginning of hurricane season you don't know whether you'll be affected by a storm or not. But, you know that it's much harder to recover from a storm if you aren't prepared. And that it's much easier to prepare well in advance of the storm. Last minute preparations are the hardest.

You also know that you'll need basic supplies, good neighbors and a willingness to tough it out. And that it's not possible to do all your preparations in one day. It takes time.

Preparing financially for a war is the same. We know that it's easier to prepare before the event. There's no one big thing that we can do to be 'prepared'. We need to do many small things. And, even if we're untouched by war or terrorists, the preparation won't hurt us. We should do these things anyway.

Begin with a...

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Credit Card Savings-Issuer Concerns Mute Impact
by Nancy Biglin

FREDERICK, Maryland-September 17, 2001 - American credit cardholders will save about $750 million in additional interest over the next twelve months thanks to today's surprise action by the Federal Open Market Committee. However the full benefit to cardholders from today's rate cut and the previous rate cuts has been muted by the pricing policies of many issuers. Since the first of this year, bank credit card rates have declined 159 basis points while the prime interest rate has declined 300 basis points. It is expected that banks will re-set their prime lending rates today from 6.50% to 6.00%.

While some issuers may lower fixed rate credit cards, it is doubtful it will become widespread, now that a full blown recession is upon us.

About 25% of the cards offering variable interest rates have minimum (or floor) APRs that were triggered by previous rate cuts. For example, the widely held General Motors MasterCard offers a prime +9.99% APR with a 16.90% minimum rate. The floor was triggered by the June rate cut.

The most significant factor creating the lag between the rate cuts and credit card rates is...

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Make "Lemonade" from a Lemon
by Debra Vaughn

About 2 months ago my family grew by one more. When we had our baby, the reality that we could no longer fit our family into a car hit us. Our back seat simply would not fit 2 car seats and a carrier car seat. So off to the dealership we went to buy a mini- van.

After browsing several dealerships in one day, I found two vans that I liked at two different dealerships. Here is how I got a van that is practically brand new, though the year of the van is 1996, for $8,999.00. The best part about it is, you can do it too!

First, my husband and I went to 3 different dealerships. We found three vans that we loved. At the last dealership, I fell in love with a particular van. The van was marked at $13,995. I mentioned to the salesperson that there was a van that was practically identical at the dealership right across the street that was priced at only $9,999. I told my husband that maybe we should just go across the street and see about getting that one. I did this intentionally, right in front of the salesman, loud enough so that he could hear me.

Within two seconds, maybe less, he chimed in with, "Let me talk to my sales manager and see what we can do for you." I agreed. I was expecting him to come back with a price that matched the dealership across the street. To my amazement, he came back with a price of $8,999! That was a full $5,000 LESS that the original price with NO trade-in and nothing down! We jumped on that offer and signed the contract within 45 minutes. We did insist that they give us a 30-day dealer warranty with no deductible. They agreed.

Being the "savvy shopper" that I am, I immediately drove my new van off the lot and took it to my father, a mechanic. He gave the car a good evaluation and gave me a list of everything that was wrong with it. On my way home that night, my service engine light came on...

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Looking for the Best Mortgage?
Federal Trade Comission

Shopping around for a home loan or mortgage will help you to get the best financing deal. A mortgage-whether it's a home purchase, a refinancing, or a home equity loan-is a product, just like a car, so the price and terms may be negotiable. You'll want to compare all the costs involved in obtaining a mortgage. Shopping, comparing, and negotiating may save you thousands of dollars.

Obtain Information from Several Lenders

Home loans are available from several types of lenders-thrift institutions, commercial banks, mortgage companies, and credit unions. Different lenders may quote you different prices, so you should contact several lenders to make sure you're getting the best price. You can also get a home loan through a mortgage broker. Brokers arrange transactions rather than lending money directly; in other words, they find a lender for you. A broker's access to several lenders can mean a wider selection of loan products and terms from which you can choose. Brokers will generally contact several lenders regarding your application, but they are not obligated to find the best deal for you unless they have contracted with you to act as your agent. Consequently, you should consider contacting more than one broker, just as you should with banks or thrift institutions.

Whether you are dealing with a lender or a broker may not always be clear. Some financial institutions operate as both lenders and brokers. And most brokers' advertisements do not use the word "broker". Therefore, be sure to ask whether a broker is involved. This information is important because brokers are usually paid a fee for their services that may be separate from and in addition to the lender's origination or other fees. A broker's compensation may be in the form of "points" paid at closing or as an add-on to your interest rate, or both. You should ask each broker you work with how he or she will be compensated so that you can compare the different fees. Be prepared to...

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HOW TO SUBSCRIBE TO THIS NEWSLETTER

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The author(s), Press One Publishing, and DebtSmart.com shall have neither liability nor responsibility to any person or entity with respect to any loss or damage caused, or alleged to be caused, directly or indirectly by the information contained in this email newsletter and/or at the DebtSmart.com web site. The information, methods and techniques described may not work for you and no recommendation is made to follow the same course of action. Every effort has been made verify the accuracy of all content contained herein. However, there may be mistakes; typographical, mathematical or in content. This email newsletter and the DebtSmart.com web site have been created for your entertainment only. You must always seek the proper professional advice before taking any financial or legal action. You have been warned.

Copyright (c) 2001 Press One Publishing. All rights reserved. Please do not reprint, or host on your Web site, without explicit permission. However, if you found this newsletter helpful, we grant you permission, and strongly encourage you, to e-mail it to a business associate or a friend. Thank you.