News From Our Blog

Getting the help you need, in the language you understand- Higinio’s story

By Ashley Gordon, CFPB

image

(Watch Higinio’s story in Spanish)

Imagine being told that you owe money for a debt you’ve already paid. It’s not only annoying, but frustrating, right? Not to mention expensive and time-consuming.

That’s what happened to Higinio when he found a debt on his credit report that he had paid multiple times. For years, he tried to work with the credit card company to remove the debt from his record, but they were insistent that he owed them money. Hundreds of dollars and countless calls later, Higinio submitted a complaint with the help of his friend Marta by accessing resources on www.consumerfinance.gov/es.

“The help in Spanish was amazing because I understand English, but it´s not the same when you have a problem and try to explain it in a language that´s not yours; it´s never the same.”

We understand that navigating the financial marketplace can be confusing and that language can often be an additional barrier for many people. We’re glad that Higinio got the assistance he needed, and that we were able to offer him resources that he found helpful.

To share your story or learn more about our Spanish language resources, visit us at http://www.consumerfinance.gov/yourstory.

Read this note in Spanish.

Disputing debt you never owed: William’s story

By: Ashley Gordon, CFPB

Watch William’s story

Being on the hook for a debt you don’t owe is not only stressful, but can be scary. If you don’t know where to turn, you might feel hopeless. We heard from William, who was receiving calls for a debt he didn’t owe. William tried to resolve the issue for over four years, seeing his credit get ruined in the process. He said “None of them could do anything… except tell me I had to pay them the $8,500.”

Stories like William’s are important because it’s often hard to know where to turn and who to trust for help. Because William submitted a complaint, he was able to end a four year long credit dispute in one week.

“Just to have the situation resolved…that just felt good.” William said. “In a situation for me that was seemingly endless and hopeless, the CFPB helped me to find resolution. It’s a new day.”    

We’re glad William got the help he needed, and we want to make sure that you know that we’re here for you too. To share your experience or learn more from others, visit us at www.consumerfinance.gov/yourstory.

 

Ask Marietta: Paying Down Debt

Video description

In this episode, Marietta answers the age old question, “What’s the best way to get rid of personal debt?”

Video transcript

Hi it’s Marietta with the Consumer Action Handbook. After our Google Hangout we had so many questions left to answer. We heard from so many people that we wanted to take time to answer as many as possible. And so that’s what I’m here to do, to answer more of your questions.

So without anymore…let’s just dive right in.

Today’s question is really about credit and it’s says, “What’s the best way to get rid of personal debt.”

And there are really two schools of thought on this in the personal finance world.

The first way is based on interest rates. Basically you pay down the debt with the highest interest rate first and then move through all of your debt until you’ve paid off all your debt all the way.

Over time this will allow you to pay less interest on each credit card or each type of credit because you’re paying off things with the higher interest rate first.

The other strategy is more so based on the balance on the debt, but it’s in the reverse. You pay off things with the lowest balance and then move up the line. So if you have several accounts you pay off something with a $500 balance completely and then you pay off things that have a $1000 balance and move up the line.

The strategy behind this gives you a sense of accomplishment and allows you to have some momentum. You’ve seen success, you’ve seen that you’re able to do this that you’re able to tackle your debt and pay it down and get rid of it so it gives you the momentum and strength and just the willingness to stick to it because you’ve seen that you’ve done it and you can continue you to do it.

Regardless of what strategy you use, you should pick one that works best for you. Knowing what your motivated by is a good thing. If you’re motivated more so by rationality and numbers, maybe the interest rate version works better for you. But if you need something to get you started and give you some steam to keep going, maybe using the balance as your motivating factor is the best one.

Regardless always of which method you use, you definitely want to make sure you’re making at least the minimum payments on all of your accounts because that demonstrates you’re making significant strides to managing your credit reports and credit history.

So thanks for your question.

If you’d like to ask us a question, we’d love to hear from you! You can write us by postal mail to Ask Marietta, 1800 F St. NW, Washington DC, 20405, email us (askmarietta@gsa.gov) or tweet us using the hashtag #AskMarietta.

Image description:
From the Pew Research Center:

By many measures, more borrowers struggling with student-loan payments


If you’re struggling with student loan debt, there are steps you might be able to take to help. Check them out.

Image description:

From the Pew Research Center:

By many measures, more borrowers struggling with student-loan payments

If you’re struggling with student loan debt, there are steps you might be able to take to help. Check them out.

Image description: When it comes to budgeting and debt, 61 percent of U.S. adults admit to not having a budget, and one-third of U.S. adults indicated their household carries credit card debt from month-to-month.
Learn more about American trends with personal finance from the 2014 Consumer Financial Literacy Survey conducted by the National Foundation for Credit Counseling.

Image description: When it comes to budgeting and debt, 61 percent of U.S. adults admit to not having a budget, and one-third of U.S. adults indicated their household carries credit card debt from month-to-month.

Learn more about American trends with personal finance from the 2014 Consumer Financial Literacy Survey conducted by the National Foundation for Credit Counseling.