Prepaid Debit Card Reviews, Complaints, Etc

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Advice To Homebuyers: Boost Your Credit Score
It seems like such a simple equation. If you want the best mortgage interest rate, be sure that your credit score is as high as possible. And for once, this deceptively easy to understand formula actually is true. You really can get better interest rates if you can boost and keep your credit score as close to the maximum of 850 and steer it clear of the low end of 300.

According to a recent story by mortgage and credit expert, Dan Green, there are some easy ways to get that all important credit score up to where it will really do a potential homebuyer some good. “Anyone can raise their credit score to “Excellent.” This is because credit scores are based on a formula and parts of the formula are well documented and described,” writes Green on the website, The Mortgage Reports.

So what does Green suggest? First of all, it’s important to understand what scores actually matter. While there are many credit reporting companies in the market, he says that only three matter when it comes to mortgages: Equifax, Experian and TransUnion. Not only are those the only three credit reporting outfits that matter, Green says that anyone considering buying a home needs to realize that only specific reports issued by these companies are used by mortgage lenders. They are:
- The Equifax Beacon 5.0 report
- The Experian/Fair Isaac Risk Model v2 report
- The TransUnion Fico Risk Score 04
This is important to know because these are the reports mortgage lenders analyze when they’re considering your application for a home loan. “Your lender then takes the median of the three scores (i.e. the one in the middle), and calls it your credit score,” writes Green.

One benefit of applying for a mortgage is that a lender will supply you with a copy of your credit score for free. Green suggests you take advantage of this access to a free credit score and also pay heed to the notes that accompany them, which provide a road map to improving your score. Tips will include the obvious, like always paying your bills on time, and the less clear cut, such as keeping older credit cards open and using them from time to time.

Another bit of advice Green offers is to note how close you are to the credit limit on any of your cards. If you’re near the limit, that is a black mark against you in a lender’s eyes – the ideal is to have a balance of less than 30 percent of your credit limit. If you can’t pay down the limit, Green suggests asking the credit card issuer to up your card’s limit to get it below that 30 percent threshold. Paying close to attention to credit scoring details, insists Green, can up your score by 100 points in no time.
July 16, 2014
Turning Student Debt Into Good Credit

There’s just no escaping the fact that a mountain of student debt is a big burden. And these days, kids fresh out of college are looking at a Himalayas-like amount of debt to pay off before they’ve even started their careers. According to a recent story in US News & World Report, college kids owe an average of $33,000 from the moment they grab their diplomas and stride into adulthood.

But in that same story reporter Divya Raghavan offers up a way grads can make lemonade out of that forest of lemons. How? By responsibly paying off all of that student debt and showing lenders that you know how to handle your finances responsibly. Doing so is a way to build the kind of credit score and credit history every adult needs. “They can result in a graduate being able to qualify for his or her first apartment, first car loan and, very often, first unsecured credit card,” writes Raghavan.

As Raghavan points out, there’s nothing particularly magical about how this all works. In simple terms, a large amount of student debt can only be paid off with diligent and persistent hard work. Which means that if a fresh graduate makes on-time payments month after month creditors are going to get the message that this young adult is someone who can be trusted with a car loan, mortgage or credit card. Lenders will know that a former student is low risk because student loan payments are reported to the three major credit bureaus, TransUnion, Experian and Equifax. The credit score and report that these agencies come up with is based on how timely and complete those repayments are.

And their impact goes beyond just how likely you are to get a car loan. There are times when prospective employers will ask applicants for their credit report. Although employers can only review a potential hire’s credit report with the consent of a job applicant, it’s important to be aware of the possibility of a request. In fact, a study by the Society for Human Resource Management found that almost half of employers conducted a credit check on potential employers.

There are times when even the most well-meaning and responsible graduate just can’t make those loan repayments. When that is the case, Raghavan writes that the best approach is to defer the loans. Defaulting on the debt will do lasting harm to your credit score. “As a good rule of thumb, remember that it’s OK to defer, but not to default,” she writes.

July 14, 2014
IRS Rule Change Targets Identity Thieves

It’s not just big retailers like Target that are grappling with ways to thwart identity theft and fraud. The Internal Revenue Service recently announced plans to limit direct deposits of refunds in an effort to fight criminal activity targeted at taxpayers.

According to a recent article in Accounting Today, the IRS will limit the number of direct deposit refunds that can go into a single account or prepaid debit card to three. Once the IRS has made three electronic deposits into a single account it will automatically issue paper checks for any additional refunds. Any taxpayer who does reach the threshold of three direct deposits will be notified by the IRS that they’ve reached their limit and will receive only paper checks in the future.

The new procedures will go into effect in January of 2015 and are meant to make it more difficult for criminals to steal taxpayer identities and hijack their deposits. Currently, an identity thief or unscrupulous accountant could set up an account or obtain a prepaid debit card into which they could funnel multiple tax refunds. “The new limitations will also protect taxpayers from preparers who obtain payment from their tax preparation services by depositing part or all of their clients’ refunds into the preparers’ own bank accounts,” said the IRS in a statement. “The new direct deposit limits will help eliminate this type of abuse.”

However, the IRS did caution that some responsible taxpayers will be negatively impacted by this change in procedure. For instance, families that file multiple tax returns and have all their refunds direct deposited into a single account will need to either open new accounts or be willing to receive paper checks. Despite the change, the IRS still urges taxpayers to utilize direct deposit. “The vast majority of taxpayers will not be affected by this limitation, and we would encourage taxpayers and tax preparers to continue to use direct deposit,” the IRS said. “It is the fastest, safest way for taxpayers to receive refunds.”

July 11, 2014
A Wave of Debit Card Fraud

It’s the sort of call that is becoming unnervingly common these days. Police in the city of Gilbert, Arizona near Phoenix, recently warned that criminals impersonating law enforcement officers were phoning residents and threatening them with arrest unless they pay outstanding traffic tickets. The way to pay the fictitious tickets? By handing over credit card numbers or prepaid debit card PINs.

In Tuscaloosa, Alabama, another group of recent debit card fraud perpetrators were even more ominous. “We have had a couple of bomb threats in the city of Tuscaloosa. The caller will state if you don’t put so much money on a Green Dot [prepaid] card or the bomb will blow up in an hour,” Sgt. Brent Blankley of the Tuscaloosa Police Department told the local Fox TV channel.

While the locations and cover stories are different, the use of prepaid debit cards and other plastic forms of payment by scammers is becoming an almost everyday occurrence. In fact, according to a new article on MarketWatch.com over 40 percent of Americans have faced some sort of debit card fraud or credit card scam sometime over the past five years. Not surprisingly, about half of Americans engaged in so-called “risky” financial behavior – everything from writing down a PIN number to carry around in a wallet or not shredding documents with sensitive account information – were victimized.

Given the constant onslaught by scammers and the successful efforts to obtain customer information from large stores like Target, it’s reasonable for people to take steps to protect themselves from debit card fraud and credit card scams. A start, of course, is not engaging in the sorts of risky behaviors that are easily avoided. The MarketWatch article, citing research conducted by ACI Worldwide and Aite Group, provided a list of five activities to avoid.

As a start, reporter Priya Anand says leaving a cell phone unlocked is an invitation to criminals to access personal financial information. Despite the risks, 11 percent of Americans don’t protect their phones. Second, over 10 percent of Americans don’t bother to shred documents that include personal financial information before tossing them in the trash. This should be avoided.

Third, banking or shopping on a public computer, like those available in a library, can make your banking and credit card information easily available to thieves; still, almost 10 percent of Americans do this. Fourth, actually giving out your financial information to the type of scammers operating in Arizona and Alabama is also a bad idea, as is replying to emails requesting your account information. And finally, writing down a PIN and putting it in your wallet or purse could very well get you in financial trouble. But taking simple steps can protect you from debit card fraud and credit card scams.

July 1, 2014
Prepaid Debit Cards that Allow you to Pay Bills (Like a Checking Account)

Prepaid Debit Cards that Allow you to Pay Bills

It’s an irresistible headline. “Why a guy making $100,000 a year can’t get a bank account,” was the provocative title to a recent intriguing story by Danielle Douglas in The Washington Post.

In it, Douglas describes how a Kansas City software engineer, Zikomo Fields, pulls in six figures annually yet has to rely on an American Express Bluebird card, a checking account alternative, to handle his finances. It’s not the well-paid tech professional’s first choice, either, but the checking account alternative is his best option after being turned down by credit unions and banks, including Bank of America.

According to Douglas, this odd situation of a well-heeled, seemingly desirable customer being forced to resort to a checking account alternative financial product usually associated with low-income Americans is the result of the screening process banks use to weed out risky consumers. In the case of Fields, it all comes down to his inclusion in a database called ChexSystems. “Thousands of banks and credit unions screen would-be customers through databases like ChexSystems that document repeated overdrafts, bounced checks, unpaid balances and other behavior that could signal fraud,” writes Douglas.

No Fee Visa Card that Has all the Benefits of a Checking Account:

Chime is a new Visa card that is amazingly free (unless you use the card outside of their large ATM network). This is best alternative to a prepaid card that we’ve seen in 5+ years and offers all of the benefits of traditional bank account.

It’s a real debit card, (not a prepaid debit card which usually have a lot more fees) and people with poor credit can apply too as there is no credit check. Chime can be managed entirely from your smartphone. No overdraft fees. No minimum balance. No monthly service fees. No transfer fees. Over 38,000 fee-free ATMs, plus 30,000+ cash-back locations.

And for a limited time, earn a Cash referral bonus of $50 when you tell your friends and family members about Chime and they sign up (and they’ll earn $50 too)- details within the app after you apply! Click for more info.- you can apply online in just 2 mins with no obligation. Start by simply entering your email address and clicking “Get Started”– over 3 million customers couldn’t be wrong. 🙂 (Ad Link)

To be sure, Fields admits that he has a blemished financial record. Working as a contractor in the past meant there was a time when Fields had to overdraw his US Bank account in order to pay bills. Although he eventually was able to pay off what he owed, Fields has discovered the hard way that his name is still very much on what amounts to a financial no-fly list. As is the case with dings to your credit report, it takes a full seven years for someone’s past financial black marks to be removed from databases like ChexSystems.

There are a few results of this blunt approach to assessing the potential risk of new customers. For banks, it means that they are potentially missing out on a customer who might use their services to buy a home or a car. Potentially more consequentially, it also may cause even more consumers to flee traditional banks. Already, low-fee non-traditional financial products like the Bluebird card and prepaid cards like Chase Liquid are making it easy for customers who can’t qualify for a credit or debit card to handle their financial transactions.

As banks turn away more perfectly good customers simply because their screening process is lazy, that trend will likely only continue.

June 25, 2014
Suze Orman Prepaid Card Discontinued June 30

Celebrity financial advisor, Suze Orman, has urged countless people seeking her money guidance to get a grip and not make a purchase when they could not afford it. It’s the kind of tough love advice that makes for good entertainment, but it’s also not what holders of the Suze Orman prepaid card are being advised to do right now. Instead, customers in possession of the Suze Orman prepaid card are being told to spend, spend, spend.That’s because Orman’s Approved Card, a partnership with Bancorp Bank that was released in early 2012, is suspending operations on July 1. According to a story in The New York Times, holders of the Approved Card recently received a letter from Bancorp Bank urging them to spend whatever money remained in their accounts – anything not spent would be refunded to them.

The disappearance of the Suze Orman prepaid card, which she reportedly launched with $1 million of her own money, is not an isolated case in the once bustling celebrity prepaid card market. Basketball superstar Magic Johnson’s prepaid card will also suspend operations on June 30. Prepaid debit cards backed by the Kardashian sisters, singer Justin Bieber and comedian George Lopez have either been discontinued or are no longer prominently marketing their celebrity backing.

The suspension of Orman’s Approved Card is especially illustrative in understanding why the stampede of celebrity prepaid cards seems to be at an end. Unlike the cards offered by the Kardashians – which charged a whopping $100 to just buy the card, along with a host of other big fees – Orman’s Approved Card charged relatively modest fees, including a $3 account maintenance charge. But even with a more consumer-friendly offering, the economics of Orman’s card clearly didn’t pencil out. “You’re dealing with a lot of customers who have a lot of things go wrong, and they need their money to put milk and bread on the table,” industry consultant Rob Rosenblatt told The New York Times. “Three dollars is a really tough baseline from which to serve customers who are going to be calling a lot.”

Another factor driving celebrity prepaid cards out of the market is competition. Large financial services companies like American Express have unveiled ultra low-fee products like Bluebird and Serve. Bluebird, for instance, charges no activation fee and has no monthly account maintenance charge. Fans of Suze Orman, Justin Bieber and Magic Johnson would have to be unusually devoted to pay unnecessary fees.

June 23, 2014