Archive for August, 2011

Are You Having Something Built? Keep an Eye on Your Contractor

August 30th, 2011

Not all contractors are honest. Protect yourself.

Your hard-earned money is at stake! If you’re going to hire a home remodeling contractor, it’s important that you hire someone trustworthy. Here are some tips to help you avoid some of the more common contractor scams.

References

While it is not uncommon for private contractors to show up for a client meeting with three references, it’s worth asking them for one more. Ideally, you want the extra reference to be someone who actually had to call the contractor back to have them fix a problem with their work. This is a great way to discover if the contractor stands behind his work and his word.

Bring a backup to the meeting

While most contractors are honest, it pays to be safe. If you live alone, have a friend on the premises when you meet with the contractor so that it appears that someone else live there. After the friend leaves, check that the doors and windows are locked. While it may be common sense to check a contractor’s record with your local chapter of the Better Business Bureau, not everyone does. Check them out with BBBs in surrounding states, particularly if you seek home remodeling following a natural disaster.

License and bonded status

Contractor’s license, operating permits and bonds (surety, performance, workers’ comp) must be verified before hiring any contractor. FEMA disaster inspector Lanard Cullins told Bankrate that consumers should verify a contractor’s documents through the secretary of state’s office in any state in which they’re licensed. Checking with local authorities to ensure they have complied with the law is also advisable. If you’re unsure of what to look for in terms of contractor bond, consult with an insurance agent who specializes in home remodeling, advises Phae Howard of the National Center for the Prevention of Home Improvement Fraud.

Checking up on insurance

A consumer must know for certain before hiring a contractor is whether the contractor’s insurance is in effect. Stolen equipment is a fact of life, and you want your contractor to be prepared. Another important note regarding insurance involves contractors asking you for your insurer’s contact info, then contacting them for you. This is an absolute scam, says Cullins. Never give personal insurance info or proceeds to any contractor.

The contractor should buy supplies

Hitting you up piecemeal for supplies, or asking for upfront money for materials at regular intervals is a sign that your contractor is unprofessional. If you must buy, never give the contractor your money. Meet them at the supply store, buy what’s needed yourself and make sure the materials will be delivered to the site the day they’re needed.

Play it safe with contracts

Don’t sign a contract with a contractor unless you’re sure the details are correct, including start and end dates for the project. Have an attorney review the contract before you sign it.

Hire an inspector

Have your local building code inspector or an independent inspector check your project once the contractor has pulled the permits. Using an inspector before and after a project is also a good safeguard.

Tags: Building contractors, Construction, Contractors, Remodeling
Posted in Assurance / Insurance, Business, Employment, Finance, Money, Personal / Internet | No Comments »

If You Have Taken a Payday Loan, Watch Out For Scammers

August 29th, 2011

Beware of payday loan collection scams

The latest disaster, hurricane Irene, will cause yet another national expense and will no doubt lead to new and unexpected financial hardships in some areas. As it is, many of us in this tight economy are living from paycheck to paycheck. Payday loans can be a helping hand for people living close to their means when unforeseen expenses occur. As usual the scammers are out there, circling like vultures and ready to take advantage of those already financially stressed people with threatening phone calls, trying to bully them into paying non-existent debts.

Lenders are bound by laws

Legitimate payday loan companies offer small, short-term loans for people who wish to borrow against their next paycheck. However, when collection becomes an issue, these lenders are bound by laws. They are not allowed to harass their debtors, nor can they threaten arrest or jail.

Scammers

In February, Maria Brown of Houston, Texas, contacted authorities reporting scammers. “They contacted me and really had me believe I was going to jail for check fraud,” Brown said. She had taken out payday loans before the calls, and the scammers seemed to have access to those applications. They sounded legitimate because of the information they possessed about her. Brown realized she was being scammed.

Warnings

Consumeraffairs.com warns of a North Carolina caller described as “having a thick accent” who has been harassing North Carolina consumers for “a couple of years now.” The man uses abusive language and threats to frighten consumers into paying phantom debts with their credit cards. Arizona’s Attorney General’s office reported a similar scam in May. Callers claimed to be from fictitious law firms or government agencies and threatened legal action if the victims didn’t pay money owed on payday loans.

Watch out for these companies

Scammers claim they represent real companies that they are not actually affiliated with, or they may use fictitious company names. Beware of callers who say they represent Morgan & Associates, Federal Bureau of Investigators, DNR Recovery, DNI Recovery, Legal Accounts Association, Department of Law and Enforcement, Cash or ACS.

Fair Debt Collection Practices Act

According to the Fair Debt Collection Practices Act, debt collectors are not allowed to threaten arrest if you can’t pay. There is no law in the U.S. that allows arrest for unpaid loans. Collectors are also not allowed to harass, annoy or threaten any kind of violence. It is also a crime to falsely represent oneself as a lawyer.

What to do if targeted

Consumers who receive these calls should never verify personal information over the telephone. Ask for written proof of the debt, which is something legitimate collectors are required to supply. Suspicious consumers may also wish to check their credit report to be sure there have been no unauthorized credit card purchases or loans taken out in their name. Report any suspicious or threatening calls to the Federal Trade Commission, the Better Business Bureau and your state Attorney General’s office.

Tags: debt collectors, Debts, Fraud, Payday Loans, Repayments
Posted in Advance Cash Loan, Economy, Finance, Identity Theft, Loans, Payday Loans | No Comments »

Retirement Planning: Avoid Mistakes

August 27th, 2011

One bad decision can ruin a lifetime of good ones

Actions have consequences, and this is more than true in the final third of life. If you are at or near retirement, the decisions you’re about to make will have consequences for decades to come. Unfortunately, it only takes one bad decision to ruin a lifetime of good ones. So what are the biggest mistakes to avoid?

Link your retirement to your bank account

If asked when you’ll retire, your answer should be a dollar amount, not a year. Retirement is about independence, not simply age, and money is critical to independence. You need to know exactly how much you need to save to fund the retirement you want.

Managing your risk

Risk is a necessary companion to investing. When you’re in your 20s and 30s, you can afford to take greater risks in hopes of receiving greater returns. If you lose money, you have decades to recover. Not so as you approach retirement. You can’t afford to operate at the same risk level. As you age, you need to progressively shift out of potentially volatile investments. During retirement, large losses in your portfolio are extinction-level events. The bigger the loss, the worse the recovery. If markets have taught us anything during the last 10 years, it’s that you need a plan to manage your risks and avoid large losses.

Senior risks

The same is true for a whole host of new risks that come with growing older. A serious medical condition, the death of a spouse, getting laid off, entering a long-term care facility or getting divorced could all significantly impact your emotional and financial well-being. The goal is to consistently identify and manage your risks in order to increase your odds of a rewarding retirement.

Minimize debt

An increasing number of people are entering retirement age with no pension, inadequate savings, a big mortgage, an average of about six credit cards, and debt on one or more cars. Work is not a choice at that point any more than it’s a choice for a 30-year-old with all the same obligations and a growing family to feed. Debt adds risk and reduces cash flow. Your primary goal should be to retire debt-free and have your income at your disposal. If you retire with debt, you will spend a long period paying for the purchases of yesteryear instead of using your income to live the life you’ve dreamed of. Get professional advice. Preparing for retirement is all about accumulation, saving and investment performance are your primary concerns. But in retirement, your primary goal becomes much more complex: to continue to grow the pie while simultaneously eating it. Going without a competent adviser at this stage could be a big mistake.

Distribution strategy

When you retire, your portfolio takes over the job that the payroll department handled during your working years, namely to send you a paycheck every month. If you retire when you’re 65 and live until you’re 85, it needs to cut you 240 monthly checks. There are a host of variables that will affect its ability to do that, such as the distribution rate you choose, investment returns, inflation, how long you live, and good old-fashioned luck. Some things you can control and others you can’t, but having a well-conceived, sustainable distribution strategy will help ensure that your money lasts as long as you do.

Tags: Income, Investments, Portfolios, Retirement, Seniors
Posted in Economy, Employment, Finance, Money, Retirement | No Comments »

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