Credit

Why Does Bad Credit Matter? And What Can You Do About It?

One of the biggest problems with a bad credit rating is the fact that it can seriously curtail your borrowing options. Most people would like to be able to borrow money for, say, a car or a house. But with a bad credit rating, you’re unlikely going to be able to do either, unless you want to pay enormous rates of interest.

Often a bad credit score is caused by things like defaulted payments, bankruptcy order or phone bills you’ve paid off late. What’s more, companies won’t go out of their way to share your credit report with you. Instead, most people only usually find out that they have a bad credit score when they try to apply for a mobile phone contract or a credit card and get turned down.

So how can you improve your score?

Check Your Credit Report

Image and video hosting by TinyPic

Flickr

It turns out that there’s a lot that the average person can do to improve their ratings. One thing is to make sure that your credit report is actually correct and that all of your debts are filed under your correct name and address. Often credit rating companies get details wrong, and in the process they adversely affect your credit score, sometimes blacklisting you when you haven’t done anything wrong. Ask to see your credit report and make sure that all the information on the report is valid. Hard inquiries can impact your credit

Apply For One Product At A Time

Image and video hosting by TinyPic

Flickr

Next, make sure that you don’t make a bunch of credit applications all at once. Credit rating companies are very sophisticated in their approach, and they know that if customers are making lots of applications, it probably means that they think that they don’t have much of a chance of being approved. Therefore, if you want to improve your credit score, it’s a good idea to apply for one product at a time and not immediately try to apply for another if you get rejected.

Use A Credit Repair Company

Credit repair companies are companies that specialize in improving your standing with rating agencies, helping you to secure loans in the future. Many of these companies will charge you money, so it’s a good idea to make sure that you choose a good one. Click here for more details on which companies are good, and which are not so good.

Prove You’re A Responsible Borrower

Another big way you can show that you’re a responsible borrower is to prove it by taking out a high-interest credit card. Paying off the balance on the card every month will demonstrate to lenders that you are able to manage your finances and pay off loans when required. Spend small amounts and then continue clearing the balance, avoiding any actual interest payments in the process.

Set Up Direct Debits

Image and video hosting by TinyPic

Flickr

Finally, it’s a good idea to make sure that you pay all previously agreed upon payments. Missing things like phone bills and utility bills can have an adverse effect on your credit score. If you struggle to remember to pay, set up direct debits.


Tricks to choose the best travel credit card – Opportunities galore

 

Credit card folded into paper airplane in atmosphere

Image source huffpost

Credit cards are almost a ubiquitous part of the modern day society and people swipe them to pay for everything starting from groceries to card to gum sticks! America is a country that loves to use credit cards and probably that is the reason behind all those ads and bonuses which you have to sign up with. As there are plethora of options regarding credit cards, how would you know which one would be a good choice for traveling?

Travel credit cards offer wide array of opportunities to earn free points which you can redeem for hotels, airfares or cold hard cash. In the rat race to grab customers, credit card issuing companies are joining hands with different travel brands which entice consumers with loyalty points, bonuses, special rebates and so on. But how are you supposed to choose the best travel credit card? What are the tricks to watch out for?

1. Sign-up bonus should be huge enough

If the sign-up bonuses after you meet the card’s requirement for spending is huge, this gets your mileage account going and you get closer to a free flight. Don’t ever make the mistake of signing up with a card which doesn’t offer you high sign-up bonus. Are you wondering how bonuses work? Well, if you want to get a large bonus, you should either make a single purchase or meet a minimum expense limit within a certain time period. After that, depending on your credit card, you may earn 1-4X points per dollar that you spend.

2. Extra category spending bonus

Most credit cards offer a single point for each and every dollar that you spend but good travel credit cards will give you added points when you shop at some particular retailers. You can hereby add points much quickly. You should not want one dollar to be equivalent to one point and hence look forward to the ability to get 2-3 points each time you spend a dollar. Use those cards in your day-to-day spending and earn more than a dollar per mile.

3. The minimum spending amount should be low

It is sad enough to note that in order to grab bonuses which are offered by such cards, there is a required minimum spending amount. Although there are ways in which you can fake your spending, it is best when you’re able to snag the bonus using your regular expenses. You should typically sign up with those cards which have a minimum spending requirement of about $1000-3000 in a period of 3-6 months. Having a goal and starting with travel credit cards is good when you start small.

4. Cards with special perks and benefits

All the travel credit cards offer huge benefits and perks for the credit card holders. There are many credit card companies which will offer you special elite loyalty reward programs and other added perks. You should look out for cards with foreign transaction fees, free checked luggage, free nights, priority boarding and much more options. Remember that it is not just about achieving some miles; it is all about what else comes with the travel card that could make life easier and smart.

5. Foreign transaction fees

Majority of the credit cards usually charge a 3% fee when you use them abroad. Credit cards are great offers as you can grab a good exchange rate from them but if you pay a fee each time you use the card, then the result is not as good. The best card for averting foreign fees is the Capital One Venture Card. Though there is no yearly fee, yet there is no such reward structure as well.
Hence, if you’re eager to take a travel credit card, ensure taking into account the above mentioned factors so that you may choose the best card in the market. The better is the card you choose, the better will be the benefits that you reap.


Tricks for students to build good credit score – It’s time students become responsible

One of the most interesting parts of growing up is being able to taste financial freedom but learning how to use your finances can be challenging. It is a prerequisite among students to build a good credit as in future this helps you qualify for loans at a reasonable interest rate, auto insurance with reduced premiums, affordable rental applications, mobile phone plans and even a job at a good company! So, with all that said, how do you get started? The Credit CARD Act, which came into effect in 2010, changed all the rules of the credit card game. But to put it simply, it still comes down to showing a responsible behavior while dealing with your finances.

money-256314_960_720

Image via pixabay

Credit cards are more like necessary evil; you know you need it badly when you’re out for shopping but once you start misusing it, it backfires you in the form of outrageously high interest debt. So, if you don’t want to get tied down by the shackles of debt, here are some important ideas that you may take into consideration. Read on to know how you can build good credit.

? Be an authorized user on the account of your parents

Parents are always advised to add their student kids who are just off to college and who you don’t think are responsible enough, to their credit card accounts. The first card that a student should have is their parent’s card! The teenager should be an authorized user on the account of his parents so that they can supervise his spending activities. Moreover, this also helps students build good credit through piggybacking. In Piggybacking, a parent makes his child an authorized user of his card provided he himself has good credit. This will boost his kid’s credit score.

? Make sure you get the right credit card for you

Once a student is able to qualify for a regular credit card on his own, it’s vital for him to ensure that he takes the right credit card. He should do his homework by doing some research on finding out the credit card with the biggest benefits like lower rates, reasonable credit limits, no annual fees and clear cut billing policies. If you assess your finances and you think that you might carry a balance, opt for no-frills, low rate card. A cooler option would be a reward credit card.

? Don’t use your credit card for purchasing anything and everything

Timely payments and responsible usage of credit cards will always help you build a good credit history and also discourage the bank authorities from closing down your account due to inactivity. As soon as you get a credit card, you start a credit history and this show on your credit report. The responsible you are with your finances, the cleaner your credit report will be. But if you want to start credit, you have to continuously use the card. Think of regular expenses like groceries and other small expenses that you can put on your credit card.

? Pay off credit card balances every month

When you’re initially trying your level best to build good credit, you should try to carry no balance in your card. Make sure you pay off your balances every month and what if you can’t do that? That will clearly imply that you’re living beyond your means and that you have to curb your expenses in according to your income. A student should have a card only when he has a job or has some sort of financial support. Whenever your carry a balance, you owe interest rates and fees which thereafter leads to debt.
Being a student leaves you with improved financial responsibility. If you are eager to get yourself a credit card, make sure you follow the tips mentioned above to build good credit from the very beginning.


Do You Have Bad Credit? Here’s How To Fix It

CREDIT

A few simple mistakes and your life can take a big hit. At least, that is how it feels when you have bad credit. Just whispering the words makes banks run and hide. And, if you are in need of a cash injection, you need them out in the open. Of course, there are ways around bad credit. But, the best option is to repair your score. Then, you won’t have to worry about securing a loan ever again. Here are a few tips that will help you achieve your goal. Source Credit

Pay Off Your Debts

‘Of course – why didn’t I think of that solution?’ Okay, it might sound like an obvious plan, but that is before you knew about bad credit loans. Yes, there are firms out there that will give you a loan regardless of your credit score. Obviously, you have to be careful because there are firms that will look to profit from your situation. But, if you find a good deal, you can use the loan to pay off your loans. The loan will help you consolidate your debt into one payment. And, one payment is better than four or five. All you need are sites like ReallyBadCreditOffers.com to help you find a good deal.

Eliminate Your Card Balances

Spreading your debt out over a few credit cards is a good idea, right? Wrong, because lenders take card balances into account when they calculate your score. As a result, a lot of small, outstanding balances can pollute your credit rating. The trick is to eliminate the small balances and use one or two trusty cards to pay for everything else. Then, you won’t have as many balances left on your report, which is great. Plus, it helps you consolidate your debt even further.

calendar-660670_960_720

Leave Old Debt On Your Report

Lots of people think that all debt is bad debt. As http://www.investopedia.com shows, that simply isn’t true because there is good debt. And, you want that left on your report. You might, for example, have paid off your car or your home mortgage. Anyone that has should leave that on their report to show that they can stick to a long-term repayment strategy. Lenders want evidence that you will be able to pay their money back. The more evidence you give them, the less risk they assume. Not all debt is bad, and the good debt will come in handy when you need a loan.

Pay On Time

The final and most important tip is to start paying all of your debts on time. Not being punctual is what got you into this mess in the first place, so it is time to make a change. Write down all of the dates and make sure you keep them in your mind’s eye. Then, set up payment strategies to ensure that you don’t miss a single payment. A direct debit, for example, comes out of your account every month on the same date. If you don’t pay on time, you won’t be able to recover your score.

Bad credit isn’t the end of the world because you can improve your score.

Image Credit

 


Three ways to boost business credit

16608815130_22fe3a3dc5_z

Image Credit: flickr

In the digital era, more and more start-ups are finding their feet every day. Up until a few years ago, it was incredibly difficult for these insightful and gutsy entrepreneurs to gain any financial backing, as the drive for lenders to support them was at an all-time low after the financial crash.

However, things are starting to turn around. The ins and outs of business credit may seem a little confusing, but with a great business credit profile on your side, as well as a few helpful top tips, you should be well on your way to giving your business a boost.

1.Shop around for a vendor

Just like with any product or service, you should always look around at the various offers and rates that lenders are currently giving before deciding who to go with. Remember, whoever you do choose, you’ll spend a long time building a relationship with them and negotiating rates, so it’s worth doing the research in advance.

There are a lot of factors that can determine who the best business credit cards are with. For example, a branch may have recently expanded and want to pass their success onto business owners by lending more aggressively, from which you can benefit. Or, a lender could simply have a lot more packages and options available, one of which is practically tailored to you. Either way, make sure it is a considered decision.

2.Work on your credit profile

There are so many ways to improve your credit profile. For starters, ensure all your suppliers are paid either early or on time, and also make sure that key transactions are being recorded on your profile, as things can easily be missed but can impact you heavily.

You should aim to check your profile at least twice a year, but more frequently would mean you’ve got a better chance of spotting mistakes, payments that aren’t yours, or false negative activity. Finally, as the owner of an up and coming business, you should aim to be just as vigilant with your personal credit history as you are with your business.

3.Take advantage of card opportunities

Businesses are always looking to build healthy relationships with other industries and connections across sectors. You’ll be the one reaping the benefits this time though, if you keep your eyes peeled for businesses who actively promote and support start-ups with certain opportunities. For example, using gas cards to build your business credit.

There are several business cards related to the fuel industry, such as the Valero Gas Card, and if you mention that your company has five or more employees and that you have been doing business for two or more years, it will usually eliminate the personal guarantee. You will have to give certain details, such as the monthly average amount that you spend on fuel, but for many new companies, this can make a huge difference.

Do you know of any other ways to give your business credit a boost? Leave a comment and let us know.


Track Your Credit Score Effortlessly So You Can You Can Borrow Money!

credit score

Too many people are unaware of their own Credit Score and misunderstand fully why we have them. Your credit score can have both vast rewards and exponential pitfalls, which effect an adult in almost every aspect of their lives. Taking an interest in what your Credit Score looks like and what effects it, will make it more likely that you can live the life you want and not just what others say you can!

Your own personal Credit Score, which you can get for free & well as tons of free information about improving your credit score, is produced by a system that calculates how reliable one is with their money and determiners how likely a person is to repay money to a Lender. The reliable likenesses is determines by many factors like your overall debt, types of, and how many, bank accounts you have, number of late payments and how old the current information is from when you are asking to barrow money from a lender. All significant financial history is recorded on a Credit Report and determines your overall Credit Score from 300-about 800. (The higher the number, the better the Credit Score.) Lenders can be individuals or companies that are allowing you to take out a line of credit in either cash or check form. This could be bank, a school, a private or commercial renter of apartments or/and houses. Which can result in all sorts of influences of your lifestyle?

credit-scoreOne in ten Americans are denied a job because of their Credit Score.  There is a source that can help people get cash even with bad credit, online payday loans no credit check, however this doesn’t work for all. Many people with poor credit are unable to get a car, cell phones, or cannot barrow the money required to buy or put a down payment on, a house! Even the amount of interest on the borrowed money that the lender demands you to pay back is a direct result of your credit score!  All of these factors, and so much more, can drastically effect the chances of being able to improve a credit score. Furthermore if you do not even know what your Credit Score is, how do you know if you need to improve it? If you have not looked at what is on your Credit Report you are under informed on how curtail everyday financial decisions are and which decision effect your future finances.

By using online sites and applications to track your Credit Report and Credit Score using free tools, like https://www.creditkarma.com/, https://www.creditsesame.com/free-credit-score/, and https://www.credit.com/free-credit-score/ not only will you know exactly what effects your score, you can also access your real time Credit Score! Not only do these sites track your credit score & give you free bureau reports, but they also offer top rated advice & additional tools to help you make your credit better.  Many advantages like these are accessible online,  and are reliable tools that need to be used to ensure healthy credit.  Learning about your credit, and the best ways to improve it is also imperative to keeping your credit healthy!  Useful alerts from these major credit report companies are able to notify you of any unauthorized information that has been recorded as an added defense to keeping your credit healthy!  With all these major tools at your disposal, not only tracking your credit, but keeping it health is much easier than ever before!


4 Things to Know When Taking Out a Loan for Your Small Business

Small businesses often need external financing to help them make large purchases or get through slower business periods when cash flow is low. A small business loan is one way that business owners can address their short and long-term financing needs. Before you start the process of taking out a loan for your small business, you should consider these four tips to help you prepare for the process.

Know Your Credit Score

16795005832_09beaac1f5

Image via Flickr by GotCredit

Check your personal credit scores for all three reporting agencies. To do this, you can request a free credit report at AnnualCreditReport.com. Check for errors and resolve these immediately, if possible, before beginning the loan application process. If you have payments that you’ve fallen behind on, try to bring your accounts to date to help your chances of being approved and receiving a favorable interest rate.

Your chances of being approved are greater with a credit score above 600. However, there are options for individuals with lower credit scores which offer financing at higher interest rates.

Analyze Your Financing Needs

Clearly establish what you need extra financing for. Is it for a long-term investment like real estate or equipment that will last 10 years or more, or do you need short-term financing to buy more inventory or meet regular expenses? This will direct you to the options that you’ll need to evaluate to meet your business’s needs.

Evaluate Your Loan Options

If you need a short-term loan, inventory financing and loans to increase working capital are available from traditional lenders like banks and credit unions. There are also alternative financing options like merchant cash advances, which help businesses get short-term loans in as little as 24 hours to quickly resolve cash-on-hand shortages. To obtain a merchant cash advance, a business leverages its future revenue. These loans typically carry a higher interest rate and fees. For business owners with low credit scores or serious funding time constraints, online lenders like Bad Credit Business Loans can represent a viable option for their business needs.

To invest in areas like real estate, make large equipment purchases, or undergo considerable expansion, you will most likely need to seek out a long-term loan. There are also special small business loan programs available from the Small Business Administration, many of which are specially designed to help you grow your business and often offer more favorable interest rates and repayment terms.

Prepare Yourself for the Process

 7650804342_9715bb425f

Image via Flickr by thetaxhaven

Go over your financial statements to make sure everything is up-to-date and in order. These documents show your business’s profitability, as well as the assets available as collateral for your loan. If you’re planning to expand, you’ll need to have a well-crafted business plan and marketing strategy. This will prove to a potential lender that you’ve prepared well for a successful expansion. If you need to, enlist the services of a professional consultant to help you with these documents.

Use small business loans responsibly, and do not take on more debt than you can handle. Small business loans are helpful tools that allow businesses to grow and contribute more to the local economy by hiring additional employees and offering better services to their customers.


Best ways to achieve credit card relief – Know more

For a household it’s not good to share credit card burden. Credit card debt can be repaid or lessened in a number of ways. A few methods will demand more effort and time than the common ones. In comparison, you may come across methods that don’t seem effective as repayment options; these methods tend to be a little riskier.

A borrower needs to study his specific financial situation and whether his chosen debt repayment method is ideal for his situation. Only then he will be able to opt for a successful debt repayment plan. This article throws some light upon the most advertised repayment methods besides the usual ways of lowering one’s credit card debt.bigstock-Debt-Relief-Just-Ahead-Green-22963049-e1368042855375

Once a borrower is able to study his financial situation carefully, he’ll soon be able to identify expenses that he can actually do without. It will surely help him develop a budget so that he may pay off his debt in a systematic way. Although things won’t change overnight, but with time he will be able to save more out of his income. A borrower needs discipline, patience and time to acquire

Under such circumstances you’ll need to follow a different path. You may need to opt for a credit card relief program. Such a program mostly involves indulging in a repayment plan.

A credit card relief program is a repayment plan between a credit card company and the borrower. Depending on your credit card interest and balances, you’ll be offered repayment plans. Then there are other factors like your expenses and incomes that affect your repayment terms.

An effective credit card relief program makes it necessary for you to remember the following points

Guaranteed Debt Relief

There are situations wherein you’ll be able to settle your debt for a lower amount or lower the interest rate through negotiation with the creditor. Credit card companies are usually not willing to negotiate interest rates with their borrowers unless they are payment defaulters. They will only accept a settlement offer if they’re certain that the settlement will yield more returns than what they would get after filing a lawsuit. Entering into a credit card debt relief program helps a borrower as these services involve experts that are experienced in negotiating with creditors and achieving the best deal.

Free Credit Analysis

The credit counselors associated with credit card debt relief programs will offer a credit analysis for free. They will evaluate your expenses and incomes for each month and decide on a monthly payment for you. It is a single amount that you ought to pay them based on your ability. Once you make your monthly payments, they will pay a certain amount to each of your creditors after deducting a small fee as their processing charge. You’ll soon see your balances getting reduced or your interest rates falling after you enroll with these programs.

Seek Your Consumer Rights Advantage

The Fair Debt Collecting Practices Act strictly forbids consumer debt collection through abusive means. Under this act debt information needs to get validated for ensuring its accuracy, showing a disputing option to consumers and to improve the collection methods. Business of debt collection can now be conducted as per the guidelines set by this act.

Stop Collection Calls

A collection agency can’t call you anytime they wish. They have to follow the FDCPA guidelines alongside the FTC norms. The collections agencies can’t call you beyond the business hours and they can call you at work. They can’t share your financial status with any other person. Once you’ve enrolled with a credit card relief program you may always ask them to confront your credit counseling team. You’ll no longer have to handle their calls by yourself.

Get out of debt now, repair your credit and opt out of bankruptcy

Under circumstances when you undergo serious financial crisis, you don’t much time to consider the paths that lie ahead. Whatever you do, you shouldn’t consider filing for bankruptcy since it will hit your credit score and the effect will be shown in your credit report. It will haunt your finances for 10 long years.

It takes a long time for someone to improve his credit. Your credit score can actually be improved only when your credit history is rebuilt. Your credit score is affected by every delinquency that is reported. Your credit history will determine how much time it will take for these negative instances to be removed from your credit report.


How Credit Card Use Led to the Financial Crisis

The use of credit cards in the 21st century is a record high. According to this source, each individual has at least two credit cards at this time. It is also common for these cards to have credit limits that are way beyond the actual capacity to pay of the credit card holder.

This situation led from one disastrous event to another leading to national credit card crisis and eventually a global financial crisis. It would be worthwhile to trace how bad credit card use contributed to the financial crisis in the past decade.

Step 1: To increase business, credit card companies launch tempting offers to consumers. This includes easy credit card access, and a credit limit that is beyond the annual income of the average consumers.

Step 2: Consumer gets a credit card and makes his or her first purchase to get a feel of it.

Step 3: Consumer pays the credit card company. Everybody is happy.

Step 4: Consumer now uses the credit card for routine purchases including groceries, regular shopping, movies and dinner dates. At the end of the month, he or she pays the credit card company. Again, everybody is happy.

Step 5: Consumer stumbles upon a tempting gadget that is bit too expensive for his or her income level. But wait, “my credit limit can help me afford it”, he/she realizes.

Step 6: Consumer takes out his/her card and goes home with a new toy. Beaming a big smile and thinking that this can be repaid in a matter of time.

Image-1Step 7: Consumer passes by a fancy restaurant and realizes that his or her credit limit affords him or her to taste something fancy once in a while.

Step 8: Consumer discovers holiday destination and realizes that his or her credit limit affords him or her to take some day off and lounge in the luxury of a world class resort.

Step 9: Consumer gets a bill from the credit card company and realizes that his monthly pay check is not enough to pay the total bill. Scared of the big penalty and interest rates, he or she uses his or her paycheck to pay the amount billed. The credit card company is happy. The consumer says, “it’s good that I have a credit card to pay for my groceries and the rent until the next pay check.”

Step 10: Consumer uses the credit card to buy groceries, pay the rent, pay the mortgage, and everything.

Step 11: Consumer gets the bill and is able to pay only half of the total amount billed using all of his or her pay check.

Step 12: Consumer uses the credit card to survive.

Step 13: Consumer pays a fourth of the total amount billed.

Step 14: Consumer uses the credit card to get through life.

Step 15: Consumer pays only 1/10th of the total amount billed. By this time, the interest payments are even higher than the monthly income.

Step 16: Consumer uses what remained of his or her credit limit to get by.

Step 17: Credit card company calls. Frantic that all of its clients are unable to pay.

Step 18: The banks write-off a large amount of loans. Financial institutions are on the brink of bankruptcy. The consumer gets laid-off. They all turn to the government for help.

You know what happened next.


When is the Best Time to View Credit Reports?

There are a lot of common myths when it comes to credit scores and obtaining credit reports. Some of these myths include, ‘checking your credit report will lower your credit scores,’ and ‘viewing credit reports is expensive and unnecessary.’ These myths, of course, have since been discovered as untrue, and more and more people are wondering what is actually right when it comes to credit reports.

The truth is there are a few times in a person’s life when it is not only beneficial, but very important to get their free credit reports from CreditSesame.com or Wallethub. Getting credit reports at these times can help anyone make better financial decisions, reduce and avoid debt, and plan better for their future. Anyone can use these tips to help them decide when the best times to get their credit reports are. Here are some of the best times to view credit reports.

When is the Best Time to View Credit ReportsRight now

It has been said that there is no time like the present. People who have never checked their credit reports or have not checked their credit reports in a year should check them right away. A lot of changes can happen to a person’s credit report over the course of a year, so a good rule for anyone is to check their reports annually to make sure they are still on track to meet their financial goals.

When getting ready to take out a big loan or line of credit

Taking out a loan or getting a new line of credit is a big financial change. These changes almost always effect a person’s credit reports, and people who are unaware of what is on their credit reports say may not be as prepared as they should be to apply for a loan or line of credit. Credit reports can help people become the most prepared so they can understand not only what they need to do to get their loan or line of credit, but also what they will need to do to pay off their loan or maintain their credit.

When planning a savings budget for the future

Saving for the future is something everyone does, or everyone should be doing. Saving for the future allows people to live comfortable throughout their life and prepare for their children’s lives. When planning out how to save for the future, credit reports can be a big help. Credit report information can help people make a plan for saving and create a more stable financial future.

When some unusual activity happens

Sometimes there are unusual activities that happen to a person financially. A couple examples, include being turned down for a loan or receiving an unusual bill. These may be small misunderstandings, but they could be a red flag for a bigger issue. Checking credit reports can rule out that those situations are identity theft or fraud.

When trying to get out of debt

Everyone has some debt at one point or another, but having too much debt can cause serious financial issues. Anyone who wants to make a plan to get out of debt should start with their current credit reports.

Image: http://pixabay.com/en/wristwatch-watch-time-gadget-407096/


%d bloggers like this: