5 riskiest places to use your credit card

Most of us assume that swiping a debit or credit card is going to be a secure transaction. While that is true in most cases, there are places that are easy targets for identity thieves. Here are five points of sale that can be easy pickings for the dishonest people of the world.

Non-Bank ATMs

There is no way to say enough bad things about ATMs that are not owned by a bank. The encryption is often less secure than at bank ATMs, free standing ATMs can be more easily hacked, card readers have been attached to the legitimate swipe area, and some of these machines are actually fake. Thieves have been known to place defunct ATMs around large cities then sit back and wait for the card information to flow to them.

Flea Markets

Flea markets are great places to shop, but risky places to use a card. Many of these venders travel from market to market making it hard to resolve any card issues. Very few of them have point of sale terminals, so they make carbon copies of your card. While these vendors may be legitimate, there is a chance that they will lose the copy.

Foreign Hole-in-the-Walls

Credit card issuers report that small shops and quaint restaurants in foreign countries have a high percentage of credit card fraud. Issuers generally write off these fraudulent charges with no consequences to customers, because the merchants can't be located. Why take a chance. Use cash if you go to a shop that may not be on the ''beaten path.''

Public WiFi

Buying online can be risky. That is not to say that you shouldn't shop online. Always check to see if the site has a Better Business Bureau stamp of approval and look for a secured shell logo. It is even better if you are directed to Paypal or another online payment system. That will give you an option to request your money back through a third party.

Shopping online is commonplace today. In the vast majority of cases the transactions are secure when made from you home computer. Problems arise if you use Wi-Fi hotspots or public computers. Even if you are on a secure page, your information can be stolen by a savvy hacker using the same Wi-Fi or who uses a public computer after you.

Many identity thieves count on the complacency that most cad users display in their everyday lives. After all, swiping a card is as automatic as breathing. It is up to you to protect yourself and ensure your financial security at every terminal that you approach.

Citations:

• FTC Identity Theft Resources

Taylor Brown's company, Credit Repair Zoom, teaches you how to repair your credit after identity theft.  He hopes this article will make you think twice before swiping your card under high-risk circumstances.

Credit Repair Companies Versus Consumer Counselling

Credit repair and consumer credit counseling are different forms of financial assistance that help those who face large debt or out of control credit. In the case of credit repair, the goal is to rebuild credit rating or credit score with the help of a third party claiming to be skilled at negotiating with creditors and credit agencies.

Credit counseling is different from credit repair services as there may be a conditional requirement by either a lender or court.  For example, in the United States, consumers who file for bankruptcy are often required to receive consumer credit counseling as part of the bankruptcy filing procedure. Credit counseling may also involve debt management and debt settlement services.

Credit repair

According to the U.S. Federal Trade Commission (FTC), credit repair company's are often scams. The proliferation of such scams led to the rise of the Credit Repair Organizations Act which made it a requirement to receive a copy of any contracts before signing them. Even so, credit repair company's may be apt to creating misleading promises that consumers should be aware of.

The fact of the matter according to consumer advocates is that there's nothing a credit repair company can do for hundreds of dollars that an individual cannot. It may seem intimidating or complicated dealing with poor credit, but that doesn't have to be an excuse to lose money paying for a service that can be done for free. If there's nothing a credit repair company can fix after they receive your money, they don't pay it back.

To illustrate the above point, credit repair company's tout being able to correct erroneous information on a credit report if there is any at all. An individual can do this by visiting www.annualcreditreport.com and obtaining a free credit report then sending a dispute letter such as the one available at the Federal Trade Commission's website.

Consumer credit counseling

Consumer credit counseling generally has a more specific and legal function. In regard to pre-bankruptcy counseling, consumer credit counseling is also required to be free for those who cannot afford according to the FTC. The U.S. Department of Justice provides a search form on its website that allows consumers to find a legitimate consumer credit counseling service.

Bank of America distinguishes consumer credit counseling into two groups. Those two groups are debt management agencies and debt settlement companies. Both may provide consumer credit counseling, but the latter is an alternative to bankruptcy that can have a negative influence on one's credit report and costs more. Debt management companies are more educational and help consumers proactively eliminate debt while building credibility.

Credit counseling and debt management companies can also help individuals avoid foreclosure in some instances. For example, the U.S. Department of Housing and Urban Development sponsors an approved housing counseling agency program nationwide. These approved credit counselors can assist with existing and future credit and debt obligations. Thus, consumer credit counseling is not necessarily exclusive to bankruptcy proceedings, but also serves as a financial planning mechanism that helps individuals manage their debt.

Sources:

1. http://bit.ly/aXYN5p (Federal Trade Commission)
2. http://bit.ly/PtC5l      (Department of Housing and Urban Development)
3. http://bit.ly/bhQe4Z  (Overnight Credit Repair Services)
4. http://bit.ly/cuELwf   (Bank of America)

Bad Credit: Bank Account Reference Guide

The "no-chexsystems" bank account is a type of bank account extended to individuals with an unfavorable credit scores. A bad credit bank account should be insured by the Federal deposit insurance corporation (FDIC), if located within the United States. FDIC insurance allows the money within the account to be protected. If the money is not FDIC insured, the bad credit bank account may be located offshore or be an unsuitable type of account.

To obtain a bad credit bank account and individual should be of legal age i.e. 18 or over and have a valid form of appropriate identification. These types of bank accounts can be set up online and deposits can be made via an electronic payment service of which there are several on the internet that are reliable.

As with any transaction involving finances, it is wise to take precautionary steps before depositing and/or sending money to a financial institution. Such steps may include but not be limited to verifying a physical address in the case of online banking within one's country, performing fraud and scam searches using the bank's name, and by contacting the FDIC to verify insurability of the funds.

Obtaining a bad credit bank account may allow an individual to later obtain a secured credit against the account or obtain loans against the funds in the account. In such instances, this would allow the account holder to build credit and have a bank account in which to deposit paychecks, and/or other funds. Bad credit bank accounts may also allow the account holder to obtain debit cards, issue checks, offer interest on savings etc.

Disadvantages of bad credit bank accounts include the possibility of few or no physical locations other than ATM machines. This is especially the case if the bad credit bank account is obtained through an online financial institution. Additionally, the risk of online identity theft is present when conducting financial transactions over the internet. Whether an account is through a brick and mortar financial institution or via the internet, confirming privacy policy with the bank may be necessary.

Learning From Bad Credit

Bad credit can be caused by irresponsible financial practices or via no fault of one's own. The Fair Isaac Corporation reports the average consumer carries 13 credit responsibilities generally consisting of credit cards and installment loans. Moreover, in 2009 the U.S. Federal Trade Commission (FTC) reports 278,078 potentially credit damaging, identity theft complaints were made according to the FTC's identity theft clearinghouse and consumer sentinel.

This doesn't include the 721,418 fraud complaints from the same year. Such identity theft can lead to bad credit in addition to faulty credit reporting and individual factors such as late payment of bills.

Poor credit in an economic system sometimes forces individuals to learn from the resulting situations. However, a bad credit situation isn't always the fault of the individual. If the bad credit is due to individual reasons, it doesn't have to be a terrible thing. Having bad credit can leave one with new options and as the saying goes, "when one door closes, another may open."

Knowing what that new door is indicative of learning from bad credit. More specifically, creditors are more likely to be reluctant to lend to persons with bad credit in effect asking one to improve the credit score before any new money is loaned. How an individual learns from the bad credit may lead to different outcomes. This article will illustrate ways an individual may choose to learn from the bad credit.

Report identity theft and faulty credit reporting

The first step in learning from bad credit is knowing what caused the bad credit. Unfortunately, this may involve some research for no fault of the individual if one's identity, credit cards or other financial information has been stolen and in the case of poor credit reporting on behalf of financial institutions. To find out if the bad credit is one's own fault the following steps may be helpful:

• Check bank statements for erroneous or suspicious charges
• Call the bank or credit card company to report lost or stolen cards
• Request an immediate investigation and reversal of false charges
• Order a free credit report(s) from http://www.annualcreditreport.com
• Request a marketing freeze by calling 1-888-opt-out to minimize financial risk

Allow experience to show the way

In the case of an individual bad credit score, one can either learn to not be so dependent on credit companies, learn to build credit scores or choose renunciation the credit institution altogether. In either one of these cases, one is learning from the experience of bad credit, and making a decision for oneself about how to move forward with life. A first step one may take in learning from bad credit is to acknowledge and identify what is going on. The following are signs of bad credit:

• Low credit score
• Late payments on bills
• High interest rate
• Financial stress

After the bad credit is identified, one may then begin the process of thinking about it, reacting emotionally to the situation, or simply not caring. Which ever method one chooses the bad credit presents some unique opportunities:

• A chance to recognize one's financial situation
• A financial reality, in which one must either act or live without credit
• An excuse to not spend money
• The beginning of a new credit life, and the end of an old chapter in one's life
• A way to learn about protecting one's credit identity and profile

Immediate solutions and building new credit

It is not the end of the world when bad credit strikes. There are several ways to deal with the situation. In the case of identity theft, one can file a identity theft report. The Federal Trade Commission is a Federal organization that may be of assistance in this matter. If the credit problem is due to faulty financial reporting by a financial institution, one may need to produce paper work proving the fault and request the credit reporting agency correct the credit report. To rebuild bad credit caused by personal reasons, a step by step process may be followed. A few tips with which to deal with the bad credit are below:

• Ask the credit company or lenders for debt re-negotiation
• Contact a reputable credit counseling service
• Stop spending as much or re-budget
• Consult people one feels comfortable talking about such matters with.
• Consider legal options

The above methods may provide some immediate assistance to the situation but are not necessarily a long-term fix or cheap. Credit counselors, credit card companies and others may try to help one achieve a second chance, but what one does with that chance is up to the individual. One can learn a number of things from bad credit such as how to deal with credit card companies, what remedies are available and what steps must be taken to report financial reporting problems and theft issues.

After dealing with the immediate problem, one may then learn how to build new credit through obtaining secured credit cards, paying bills on time, identifying the ways credit scores rise etc. The whole process could take weeks to years depending on the severity and how complicated the situation is.

In summary, bad credit is not usually a pleasant experience that may or may not be caused by individual fault. In identifying, acknowledging and reacting to bad credit one may learn either directly or indirectly, how to deal with the bad credit, build new credit and take new approaches in the future. In these ways, bad credit is a learning experience, and in some cases a somewhat involuntary learning experience.

Sources:

1. http://www.myfico.com (Fair Isaac Corporation)
2. http://www.ftc.gov (Federal Trade Commission)