With credit card debt spiraling out of control amid global financial problems, banks are already feeling the pinch of the mortgage crisis as they are losing billions of dollars from unpaid credit card debt. Banks are forming partnerships with consumer advocate groups to urge the government to allow large portions of credit card debt to be forgiven.This new program which the banks hope will become permanent may involve as many several hundred thousand people that are struggling with credit card debt. The amount of debt to be forgiven may rise depending on the borrower's financial situation and may be upwards of 50 percent.

As economic times get tougher day by day, banks and other mortgage companies have already agreed to modify loans of distressed homeowners to help them avoid foreclosure. Now, banks making credit card loans have reached a point where they can lose less by forgiving part of the debt rather than loosing all of the debt completely. Due to rising loss of job consumers and even those with strong credit records are now defaulting on their credit. Banks already battered by the mortgage and credit crises are loosing tens of billions of dollars in losses. The biggest credit card lenders include Bank of America, Discover, Chase, JP Morgan ., Capital One Financial Corp., HSBC and American Express.

Americans are carrying about $900 billion in credit card debt, according to the latest figures from the Federal Reserve. . People who are in credit counseling, on average, carry seven cards. Many people are now having a hard time making their credit card payments in addition to problems in making their mortgages or car payments making things even worse.The new proposal by the Financial Services Roundtable which represents more than 100 large banks and other financial institutions was presented to Federal Regulators which would allow lenders to reduce as much as 40 percent of the credit card debt in this new pilot program. Most of the large credit card banks have agreed to such a pilot program which would forgive as much as 40 percent of the amount that consumers owe, allowing them to pay back the remainder over time.

Currently government rules don't allow lenders to offer repayment plans that reduce the amount of principal owed and borrowers to repay the balance over a period of several years. f the proposal works it would makes it possible for people to back debt without going into bankruptcy.

As a small business owner, I know really well the importance of cash flow. There are many sources of obtaining credit when you need it. Banks, SBA loans or outside investors are among the many sources of finding cash to fund your business. However, credit cards can also be used to help you out when you need it. A business credit card can be used for just about anything you can think of. Use your credit card to purchase business supplies, make payroll and take advantage of great rewards programs that can benefit you.
The American Express Starwood Preferred Guest Business Credit Card is an excellent choice for any small business owner that wants to take advantage of a great rewards program with great interest rates. Earn one point for every dollar that you spend on your American Express card. Use it at any of the Strarwood hotels, such as the Sheraton, the Westin or W Hotels and earn two points for every dollar spent. As an added bonus American Express throws in 10,000 points as soon as you sign up for the card. Not bad considering you can use those points for a two or three night stay at one of the Starwood hotels. Another great advantage of the Starwood Preferred Guest Business Credit Card is that you can save up to 25% on purchases from approved retailers. If you need to send a package overnight you can save 25% at Federal Express. Not bad if you need to send original documents when you are submitting an invoice. You can also take advantage of great discounts at Hertz rent a car. Another great advantage of using your Amex Starwood card for travel is that you get up to $100,000 dollars of travel insurance. If you purchase your airline tickets with your card and they loose your luggage, you can claim it back to American Express. Lastly, the Starwood Preferred Guest Business Credit Card from American Express comes with great interest rates. For 6 months you can enjoy 2.9% interest on purchases and balance transfers (balance transfers must be made within 3 months to qualify for low rate). After the 6 months are up you get a 9.9% interest rate. Interest rates for cash advances are 19.9%. The annual fee for this card is $45, but it is waived your first year as a card holder .


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