Sunday, September 2, 2012

How to Dispute Your Low Credit Score

There can be a number of reasons why an individual can have a low credit score. Your low credit score may be due to your credit misbehavior and mismanagement or it may be because of errors that have been incorrectly entered into your credit report and many other reasons. Upon receiving the credit report, many people assume that it contains accurate information. If you suddenly experience a huge increase in your interest rates or you have been turned down for a loan, it is time for you to check your credit report.

When you discover that your record is flawed and you believe it is not your fault, you should properly dispute the errors. This way, your low credit score will be fixed and only correct information can be found on your report.

Errors that Need Immediate Action

If you find that your score is low even though you have been making timely payments, look for issues that might need correction. These items in your credit report include:

    Payment history - The people assigned to input your payment history may make mistakes and as such, there may be inaccuracies. If you have been paying on time consistently and you have not missed any repayment schedule but your report says otherwise, dispute it. Make sure, though, that you have account statements to back your claim.

    Your account - Several errors may be associated with your account. Sometimes, your accounts may appear to be duplicated. When this happens, you may be shown to the creditor or lender as someone who have more debt than you actually have. Consequently, your creditor can increase your interest rate, particularly when they find your debt to income ratio too high for their standards. Another error involves an account that is closed by your creditor. Such a situation is often viewed negatively by lenders. Make sure that you dispute all the wrong details concerning your account to increase your score.

How to Dispute Errors

You will need all the evidences that will strongly support your case. Gather your credit statements, your bank account report, receipts, and transaction numbers if you have purchased anything online. Make copies of the documents and keep the originals in a safe place. You can choose to highlight the items in the documents that prove your point so that identification will be much easier.

After collecting and organizing your proof, you should now write your dispute letter. In this letter, write down your full name, your address, and the current date. The content should clearly convey the error in your credit report and the action that you would like to be performed to remedy the situation. For instance, if your problem is a duplicate listing of one account, this should be stated openly. You can then ask to have the duplicate removed to eventually fix your low credit score.

Send your evidence along with your letter. Make sure that you specify the documents that you have inside the envelope. Address the letter to the credit bureau that reported the wrong information. If two credit bureaus have inaccurate information, you will have to deliver two separate mails to them.

Thursday, August 30, 2012

Top Tips For Safe Credit Card Usage

In this financial climate, owning a credit card has become a necessity for many of us. Although many people believe these cards are 'bad', they aren't really, they provide a vital purpose. However, many people use them incorrectly which means that the expenses quickly rack up large amounts of interest, and before you know it, spending could be out of control. Follow these credit card tips however, and you will find that borrowing can be incredibly cheap.

Firstly you should always shop around for the best deal out there. Basically you will be wanting to look for the amount of interest charged, whether there is any interest free period, and of course, whether there are any subscription fees for just owning the card. One thing that ties into this really is to not own too many cards. This is one of the top tips offered by people in financial turmoil, most of their problems have been down to not being able to keep up with the repayments on their cards.

Keep your 'limit' though (this will stop you using the card for anything but emergency purchases), and you will want to pay off the card in full every single month so that interest does not accumulate. There is no sense just paying off the 'minimum amount' as to be perfectly honest, you will never pay the credit card back at that rate!

Try to avoid paying late on your credit card, not only can this lead to high 'fines', but it will also lead to bad notches on your credit report. Keep doing this, and you are going to ruin your credit score for a long time to come.

Always make direct purchases as opposed to 'withdrawing cash' on your card. Cash Withdrawals (sometimes known as advances) are a considerably more expensive interest wise than a straight purpose, and quite often, the interest will start racking up on them immediately as opposed to the next month.

Finally, sure you have the money in place, but be honest, do you really need to spend it? You will want to weigh up the difference between what you 'want' and what you 'need'. If you follow just one of these credit card tips, it has to be this one! There are so many people out there who will spend money just because they have it. So when you are considering a purchase, particularly a large one, you will want to consider whether you actually need it there and then, or whether you are better off waiting, which of course will end up being cheaper in the long run. If you provide this same sort of attention to all purchases, you will find that you won't 'dive' into your credit card balance too much.

Sunday, August 26, 2012

Variable Rate Credit Cards - Good or Bad?

If you've been reading our blog, then you know that I am not a big fan of credit cards. Credit cards are very convenient and they are mandatory when doing certain things such as securing a rental car or for buying airline tickets. Shopping online is also another area where a credit card is a must. I would also take a moment to discourage anyone from using a debit card (linked to your checking account) to purchase items online, especially if you do not know the vendor. It's very difficult in some cases to get your money back and as you know, the money disappears right away from your bank account. OK, with that out of the way, let's talk about today's topic, the variable rate credit card.

Now why would we want a credit card whose rate goes up and down? Well, the idea behind this is that you would get hooked by a low teaser rate and then be presented with a prime + some number as the rate you would eventually pay. Now the only time that this would be a good idea is at times when the economy is depressed and interest rates are low. Hey, wait a second, isn't that now? Yes, it certainly is! With the prime rate now in the low single digits (currently 3.25%), it's a good time to have a credit card that is a variable rate a few points over the prime rate!

Credit card companies are getting money at a super low rate now from the Fed. If you have one of those 27.99% APR credit cards, and if you have good credit, now's the time to take action.

In the case where you already have a credit card with a balance, you can save a pile of money by calling your credit issuer's customer service line. Explain to them that you've been a good customer and that you want your interest rate lowered. Be firm, but polite. If you don't get the answer that you are looking for, keep going up the chain of command. These people are working in datacenters off a script and will do everything they can to let you know that they cannot help you. Some will repeatedly insist that nobody's available, but wear them down and keep at it. Sometimes you will have to hang up on a stubborn representative. Sometimes you will have to ask for the department that closes the account before they'll do something.

Either way, companies know that rates are low and they have absolutely no justification for charging you big interest fees. The best way to avoid these fees is to always pay off your balance each and every month. I advise all of my friends and family to avoid using credit cards at all except where no alternative is available. Keep in mind that easy credit is a lure to make you spend money that you don't have. Do not succumb to the temptation of an impulse buy. When shopping, take along a list of essentials and only carry cash. That will save you from the dreaded credit card trap.

Monday, August 20, 2012

Tips for Closing a Credit Card Account Without Hurting Your Credit Score

If you are in debt, you may have already considered closing a credit card account. While this can help you save money on fees, it has one potential drawback-it can seriously damage your credit score. The good news is that there are ways on how you can avoid this.

Knowing how to cancel your credit cards the right way can put off the risk of lowering your rating. Here are the steps that you can follow to evade undesirable repercussions on your report:

Take note of your current credit score.

Before you do anything, make sure that you know what your credit score is. You can get a copy of your credit report from any of the three credit bureaus. Every consumer is entitled to get a version of their report once a year for free.

Know your credit utilization ratio.

This is one of the factors that affect your credit score. Also known as debt to credit ratio, this should not go over 30% so your score will not decrease. To compute your credit utilization ratio, add all your available credits. Then calculate all your balances. Divide your whole balance by the total credits to get the percentage. For instance, let us assume that you have available credits worth $3,000 and your total balance is $1,000. After computation, your credit utilization ratio will be 33%.

Pay off all your debts.

If you can't, you can simply pay off the credit card that you are trying to cancel. After repaying your debt, closing a credit card account will be much easier. Don't forget to confirm that your credit card has indeed zero balance by calling your issuer's customer service hotline.

Cancel your card.

Once your account's balance is zero, you can contact your creditor again to start closing the card. You may be thrown a few retention offers to entice you to withdraw the cancellation.

Follow up on your request.

Even though you have already spoken with a customer representative, you should follow up on your application to close your account. You can send out a request in writing stating the same thing. You may also want to obtain a written statement authorizing the termination of your account. It is good practice to keep a copy of the records you have acquired.

Check your credit report.

You may have to wait a few weeks before the activity will appear on your credit report. Make sure that everything is accurately documented including a zero balance on the closed account and that you have paid the card in full. Compare your credit score at the moment with your rating before you close the account. Hopefully, there is only a subtle change or none at all.

Wednesday, August 15, 2012

What Are Cash Rebates?

Cash rebates are a favorite type of reward. Many consumers are easily enticed by the line "Spend more to earn more." Credit cards that offer cash back or cash rebates let you earn a percentage each time you purchase against your credit. Most cards give you points or miles which you need to convert first to use them. Cash back is different since they are in the form of spendable dollars. Discover® was the first company to implement this offer and soon enough, other credit card companies followed suit.

How to Earn Cash Rebates

The process is actually very simple. All you need to do is use your credit card on purchases. It is similar to carrying a discount card around except that you don't get the discount on the spot. Often, companies will give you your cash back at the end of the month. The complex part is finding out how much percentage you get on each purchase. Thankfully, creditors have made it easier for consumers to compute their cash rebates by grouping the purchases together.

For instance, the amount of percentage you get from conventional purchases such as groceries, medicine, and gas is all the same. All other purchases entitle you to smaller rebates. However, if you purchase from their partner merchants, you can get really huge rebates. If your creditor has an online shopping website, you might want to shop there using your credit card. This is because they can give you 10% to 20% or even more for each purchase you make.

How to Qualify

First of all, you need a credit card that allows you to earn cash rewards. The catch is that most creditors will only approve applicants that have excellent credit. Even those that have good credit can be turned down. Aside from your credit score, they may also take a look at your employment status or your current income. There is often an income requirement since most of the credit cards that offer cash rebates come with high annual percentage rates, interest rates, and other charges. You should also be aware that you have to pay all your bills in full to avoid paying the high monthly interest fees.

Cash Rebates Tips

It is noticeable that the card offers are slightly different from one another. You can find cards that give you rebates each time you purchase on a particular category. You can sign up for each category every quarter of the year to qualify for the rebate. Other financial organizations will give their consumers a flat rate, which they need to earn throughout the year.

If you wish to gain more rewards, you may need more than a single card. With more cards, it would be easier to rack up on your total percentage. Additionally, using two or more rebates credit cards gets your more discounts on not just one type of purchase. Each card has unique privileges when it comes to cash back rewards.

Instead of using debit or even hard cash to pay for your purchases, use your credit card with cash rebates to get huge savings in the long run. Be sure to pay your dues on time, though, to avoid penalty fees and getting into debt.

Monday, August 6, 2012

How to Use The Credit Card Wisely?

Plastic money is ruling the world today. In the recent times, holding a credit card is as common as holding the cell phone. None other than the credit card will help you in the best way to meet your financial obligations. If you use the card wisely, you will be the master of your life. Financial issues will never have command on your life. The current article tells the reader about how to use the card effectively and manage the budgeted life.

Everybody knows that cash flow is important in life. If the cash runs dry, getting financial assistance in these scenarios is pretty difficult because most of the people in the world today run budgeted life. Here comes the role of credit cards into the picture, they extend required financial help. Unlike bank loans and money lenders, these credit cards will never ask you any security against the finance that you take. The credit card institutions want you to be responsible in maintaining your finance by paying the bill amount promptly. It helps you to build good credit history which in turn paves a way for easy loan approval in future.

Use the credit card wisely

The problem with usage of the card rises only when your accumulated bill go high and you are unable to close it on time. You may need monetary help for many things life. Sometimes you need it to buy your basic needs and sometimes you need it to meet your travel expenses. Depending on the single card to meet all your expenses will exceed your credit limit and your inability to pay the bills on time will give you bad credit score.

Today's credit card market includes customized cards to meet your purpose. You have cash back cards which gives you cash back rewards for your daily purchases, travel cards will give you the free credit miles for your journey. You can even find business cards which gives you special discounts on your business expenses.

Sharing your monthly bill across different cards will keep you in your credit limits and gives you ample time to pay off your credit bills.If you are a travel freak, use the travel cards to meet the travel expense. Your daily purchases will earn cash back rewards for your regular purchases. If you different cards for different purpose, you will not only manage your finances but also earn rewards in form cash backs, free miles and discounts.

In spite of your effort, sometimes you may find your card bill on the sky. If you are looking out for an option to reduce your interest rate and clear off the debt in the short time, you can take the advantage of balance transfer cards. Using these cards you can transfer the amount form your high interest paying credit card and reduce your credit bill.

Thursday, July 26, 2012

Five Factors That Determine Your Credit Score

Credit scores are becoming increasingly important. While it was once only used for mortgages and car loans, it is now used by life insurance companies and even potential employers. In fact, 60% of employers perform credit checks on at least some of their job candidates. Maintaining a clean credit report and high credit score is increasingly important.

There are 5 factors that determine your credit score. Think of these factors in terms of what a person lending you money might want to know about your history with borrowing.

Payment history (35%) - Payment history refers to your ability to make payments on time. Your credit report shows bills that were 30, 60 and 90 days late. If you were 60 days late on a bill and then paid it, the fact that you paid late will still show on your credit report and affect your credit score. Making payments on time is the single most important thing you can do to increase your score and keep your report clean.

Outstanding debt (30%) - Outstanding debt is calculated as the percentage of available credit that is being used. For instance, if you have a $30,000 credit limit, and have $25,000 in debt, you may be viewed as overextended. Some experts recommend maintaining a debt balance of about 10% of your available credit, however the most important thing is to not overextend yourself. If you use your available credit wisely, your credit score will increase.

Length of credit history (15%) - The longer you have been using loans, the better for your score. Creditors want to know that you have been a good steward of your credit over time. This is also the reason to keep your oldest credit card. Remember that card you were issued in college (the one you signed up for to get a free pizza)? Unless the card has high fees, keep it active by using it once a month.

New credit (10%) - Opening several new credit accounts will hurt your credit score as this may indicate that you are suddenly a higher risk borrower. Try to open new credit accounts only when you need them. Instead, try to have the credit limits on your current accounts raised if you need additional wiggle room.

Types of credit (10%) - Having different types of credit accounts can help increase your credit score. Instead of having 3 credit cards and no other debt, creditors would rather see a mortgage payment, an installment personal loan and a credit card. This is most important when you don't have a long credit history. Over time, the importance of this factor goes down.

When you think about it, if you were loaning money to someone that you didn't know, aren't these the factors you would consider? A person's ability to make timely payments, responsible usage of credit, how long they have been using credit, if they are opening a lot of recent accounts, and their usage of various types of loans, would all be important to know. The most important thing to remember is to protect your credit history by paying attention to these 5 factors. It takes time and energy to protect and build a solid credit history. Plus, your future job may depend on it.

So what do you think? Have you ever been turned down for a job due to a blemish on your credit report? Has anyone ever told you of other factors that affect your credit score? Feel free to share by commenting.

Thursday, July 19, 2012

Black Visa Card: The Origins of Prestige

For some time, the Visa Black card has blazed its way across your television screen as scenes of unmitigated wealth and luxury followed closed behind. A black-clad model - actress Donna Feldman - would grace the screen, with multiple readily-identifiable toys of the rich and famous scattered about her, in various states of use. This card is obviously marketed for those who aren't financially faint-of-heart. The message is clear: in America, size matters (at least; more than anywhere else) - and only the middle class and above deserves to walk around with a big stick.

So what is this Black card from Visa, and what makes it so prestigious? After all, emblazoned right on the front of the card invitation is the outrageously exclusive claim that just the top one-percent of American residents are eligible to apply for and receive the card. This, however, stands in opposition to the many claims by surprised credit card offer receivers that they were invited by Visa Black to join their exclusive Rewards Program; although of course, applying doesn't mean you will get accepted. If you do, then prepare to join the ranks of a wannabe super-culture; because while the Visa Black Card is nice, it's certainly no AMEX Centurion by American Express.

As for the attractive physical appearance of the carbon exterior, this is so impressive as to have garnered its own special patent; it can't legally be employed by any other credit card company for financial gain - or simple publicity (same thing, actually). Basically, the black Visa card isn't comprised of the run-of-the-mill plastic your average charge card is made out of. Additionally, Visa's flagship into the luxury realm is flanked by a great rewards program; above and beyond the 1% cash-back on expenditures. Card-holders have reported receiving restaurant dinners for two, Nordstrom's items and other higher-end department stores.

As for the travel benefits that go with the Visa Black, the charge card is highly-regarded in nearly a hundred countries all around the planet, with hundreds of exclusive airport lounges that grant you access to lounges that are unavailable to others, or available to them only at a steep fee. A 24 hour concierge service can make that trip in a foreign place much more comfortable, by arming you with the knowledge to fully experience the city scene.

Do all these benefits come at some cost? Visa Black requires a $495 annual fee for the privilege of using their black card. This averages out to just under $42 monthly, which should be a drop in the bucket if you're making the suggested $100,000 per year to reasonably expect to be accepted by Visa Black. With the benefits and prizes the card offers, more people than you might expect have eagerly signed up for a chance to be like Donna Feldman.

Tim is an avid finance-nerd type, and is quite interested in the ongoing fascination with Visa Black card s and other high-end charge cards. A former finance coach for upper middle class families in a gated community in Manhattan, Tim lends his expertise online these days and in occasional seminars. He helps run a website on black card s and their ramifications in the credit sector with a friend from college.

Friday, July 13, 2012

Fix Your Credit While Avoiding Rip Off Credit Repair Companies

Bad credit can simply paralyze your life. You can't get a loan for the car you want and you may not even be able to get a simple credit card. To make things worse, there are people out there who will try to scam you by saying they will repair your credit problems, as long as you can scrap together the money to pay an upfront fee. Luckily, there are ways to check and make sure you are not about to be a victim.

Any company asking you to put down an upfront fee for their credit repair services is suspicious to begin with, especially if they do not tell you exactly what they are going to do for you beforehand. Some of these charlatans will just tell you to contest all of the negative accounts on your credit report, even the ones that are valid. This isn't ethical. Others will tell you that you should set up a fake credit alias to start bringing in some credit, but that is illegal.

Any credit repair service that promises to do something that you cannot do yourself, for free, is a fraud. Services that promise to contact creditors on your behalf can provide quicker results, particularly if they are attorneys. However, if they say they can magically make your credit problems disappear in, say, 90 days, for a fee, then you need to run.

The best way to repair your credit is to look at your report. A lot of times, there really are negative entries that should not be there. Take the time to contact the companies and contest them. Legitimate enterprises will comply, although it can take 30 to 90 days. Then, talk to some of your creditors and see if they will delete your entries if you pay in full. A deletion will instantly raise your credit score, while a paid in full account will raise it a little -- but the account stays on the report. If you can negotiate a deletion, then your score will go up more quickly.

Repairing credit takes a lot of time, especially if you are new to the process. You'll spend a lot of time on hold, and you'll spend a lot of time dealing with people who are not really interested in helping you unless you can pay everything up front. Having someone take care of this for you can save you some time and resolve things more quickly. It can definitely be worth the money, especially if you have someone who is respected in the industry.

You may hear that you have to wait 7 years to get negative items off your credit report. This is true, but a lot of the time if you have no negative items in the last six months, or especially a year, your credit report will improve substantially.

There are a lot of ways to help yourself out as far as a credit score does. Don't sign up with a firm of crooks; find a legitimate business to help you out.

Sunday, July 8, 2012

Credit Card Fraud: How to Protect Yourself

The alarming reality about credit card fraud is that thieves don't need to get your actual card to commit the crime. Once they gain access to your credit card information, they can start stealing your money. They can use the information to purchase online and even on the phone. Taking the necessary precautions is the best way to deter fraudulent acquisitions.

Keep an Eye on All Credit Card Transactions

When shopping at stores, make sure that you get your card back as swiftly as possible. Don't let it out of your sight as much as you can. When performing transactions over the phone, don't give out important credit card account details unless you are sure about the company's reputation. There are also some emails that request you to give out your credit card info. Don't respond to these tricks. These are considered as phishing scams.

Contact Your Creditor

If there is a suspicious purchase in your credit statement, make that call immediately. You can also communicate with the three major credit bureaus. They can place a fraud alert in your account so that no one will be able to access it. It is wise that you keep a record of all your creditors' contact information in case of emergencies.

Sign Up for a Monitoring Service for Credit Cards

Such services will actively check on your credit reports. You will instantly be informed if your account information has been changed or if a new account has been opened using your name.

Check Your Credit Card Bills

It is advised that you open your credit statements quickly as soon as you receive them. Examine the purchases you made and make sure that there are no questionable activities there. Treat your bills as if it is your checking account. Hence, you should reconcile it every month, on time and in full. You may also want to save your receipts so that you can compare your expenses with the purchases that are stated in your monthly bill.

Freeze Your Credit

This is a very effective solution against credit card fraud. This can help you prevent any business from accessing your credit except if they have already performed transactions with you. This seals your records so that new creditors cannot view your credit report. The problem with this is that it will be hard for you to seek a student loan or a mortgage. You need to unfreeze your credit records so you can use it again. This usually takes three days and there may be a small fee for the process.

What to Do In Case of Credit Fraud

Whether you lose your card or it has been stolen, the first thing to do is to contact your issuer. Most companies come with 24-hour customer service and they are eager to help you. The US law states that reporting theft or loss of credit card frees you of the responsibility to pay for illegal charges. You can also file a complaint with the Federal Trade Commission to maximize your protection against fraud.

Thursday, June 28, 2012

Debt and Credit Card Management Tips

Credit card debt can put your financial health at risk. In order to manage your debt and your credit card use, you should gather all the pertinent information that you need. It is also helpful if you know all the options open to you. This way, you can make knowledgeable decisions and get relieved from credit card debt eventually.

If you are struggling with credit card debt, one of the things that can make it really difficult for you to make payments is the interest. When you carry a balance, you have to pay for high interest rates. This is also true for those who only pay the minimum payment. Fortunately, getting out of debt is possible. All you have to do is to be a responsible credit cardholder.

Here are some tips that might help you get rid of debt:

Reduce Your Debt

If you are in debt, it makes sense to stop any further use of your cards. However, it is not recommended that you close your accounts abruptly. Doing so will have a negative impact on your score. Instead of helping you out, it may only ruin your financial capacity even more. The best thing to do is to practice self-control. Don't go into more debt unless you have already made payments on your existing dues. This way, you will be able to slowly solve your debt problem.

Have a Budget

Having a budget and sticking strictly to it is a good means of reducing debt. Create your financial plan and stick to it as much as possible. List all the amounts you owe as well as other fees, such as interest rates, annual fees, minimum payments, credit limits, and many other fees associated with your card. Prioritize bills that have the highest interest rates then decide how much you can readily pay off each month. If you can, strive to pay off the full amount so that you will no longer incur interest rates. If not, make a payment that is higher than the monthly minimum payment. Once you are done making a full payment with that particular account, you can then go on to the next one.

The Waterfall Attack

List of all your debt and arrange them from highest to lowest. Start paying with the highest amount and the one with the highest interest rate. Focus paying on that until such time that you have made a full payment. Once this is done, you can then move on to the next on your list. Getting rid of debt through this process may take several years to accomplish but you will be able to reap its benefits if you are able to stick to your plans.

The Snowball Method

An alternative to the waterfall method is the snowballing your payments. Instead of paying off the card with the highest rate first, you will pay first the debt with the smallest balance instead. List your debts in ascending order in terms of balances. The trick here is to pay only the minimum on all your other debts except for the one with the smallest balance, which you will have to pay in full if you can. The beauty of this method is that it not only helps you eliminate debt in the long run; it motivates you to make more payments as well. Since you are paying off the debt that has the lowest balance, you can quickly witness your progress and this will encourage you to pay all of your debt.

Seek Professional Help

Credit card debt counseling is valuable especially for those with really huge debts to pay. The problem though is that this type of service is not always affordable. Nevertheless, you can find free debt counseling from many financial organizations. With the assistance of an expert credit analyst, you will know which debt release solution is the best for your situation.

Saturday, June 23, 2012

6 Credit Card Services You Should Evade

Supplementary services on credit cards may sound appealing and even logical at times, but are they really worth having from financial standpoint?

Here are the six services that you should evade on your card.

Identity Theft Coverage

This service on your card is to prevent fraudulent charges after the card is stolen or used without your permission. It seems very attractive. However, this is not complimentary at all. As per the terms associated with the service, if the card is stolen, the cardholder has to pay maximum liability for fraudulent charges. This may be anything as per the charges norms concerned.

If you can use your card cautiously, you can avoid this service.

Missed Payment Insurance

This facility allows the issuer to put your credit card payments on hold for up to two years, if you lost your job or ran out of money. You will be charged for the outstanding balance on your card. However, this does not make any sense why you should take this service.

For example, are you sure if you ever be unemployed in future? Second thing, it is folly to believe you will not continue making payment for two years in future. Carrying outstanding balance never makes a good sense. Even your modest saving can help you pay off your balance. Hence, it is unwise and waste of money to have this service.

Credit Score Tracking

If you subscribe this service from your bank, you will be able to have 24/7 access to your credit score. This will surely help you stay updated with your credit score status. However, it is futile and waste of money. If you are getting monthly billing statement from the bank, you can know about your liabilities. Second thing, credit bureaus offer cost free access to know about credit scores. Apparently, you do not need to subscribe "credit score tracking" service when you can manage your needs with these cost free services.

Debt Consolidation

This service allows you reduce your monthly payment on your plastic money. However, you may end up accumulating more debts in due course of time. Thus, it would liable you pay hefty amounts plus charges to your bank. Debt consolidation may lower your monthly payment, it is unwise considering the consequence.

Credit Score Repair

Sometimes, credit card companies take advantage of cardholder's ignorance. This service exemplifies this well. It means, your bank will help you repair your credit score.

However, do not take this service as you can repair your credit score yourself. Just continue repaying outstanding balance on time to your bank and it will fix your credit score automatically.

Balance Transfer

This facility allows you transfer existing debt of one credit card to another one. However, the balance transfer process usually takes 7 to 10 working days. What if you miss the due date by the time your balance transfer is complete?

Therefore, if you can pay your outstanding balance in full before the teaser period expires, then do not take balance transfer service.

Sunday, June 17, 2012

Golden Tips You Should Know About Credit Repair

Has your credit situation gotten to the point where it gives you many sleepless nights? The following golden tips are a helpful credit repair guide that will change your negative situation into a positive one.

Before you decide on a credit counseling agency, you should find out more about them. In spite the fact that some can be quite legitimate, others have motives that are less than kind. Even worst, some are just people trying to scam you. Consumers should always check to see if a credit counselor is reputable and trustworthy before deciding to use them.

The first step to maintaining or improving your credit score is to ensure that your bills are always paid on or before the due date. Setting up payment reminders is an effective way that can help you avoid missing a payment. There are indeed a lot of different ways to remind yourself to pay your bills. You can set up email reminders through your online banking or have text messages sent to you at specific time.

Avoid paying off high interest rates so that you do not have to pay too much. Some companies that charge high interest rates are running the risk of having those rates challenged by consumers. However, you signed a contract agreeing to pay off interests. If you want to sue creditors, you need to state your claim that the interest rates are too high.

If ever someone promises you to improve your score by changing your factual history, this is most likely a scam. The accurate negative information about your credit will stick around for seven years though it really seems unfair. If you can spot any error about the information, you should get it corrected as soon as possible..

If you are able to successfully negotiate a payment schedule for a debt, it is utmost important to request a copy of the agreement in writing. This is a great way to have documentation of the agreement if the creditor changes their mind or the company ownership gets changed. Once the debt is fully paid, you must get a statement verifying this from the creditor and send it to each of the major credit bureaus.

Also, make sure that you are never using more than 50% of your credit card's limit. Should you have a balance that is more than 50 percent, your credit score will drop. If you can afford, pay the balances on your cards; if not, do your best to pay as much as possible each month.

Your interest rate will be lower if your credit score looks good. By lowering your monthly payments, you will be able to reduce your debt more quickly. Getting better interest rates leads to an easily maintainable good credit score.

If your credit rating is too low to open up a regular credit card account, there are secured credit cards available. These types of credit cards normally require a good faith deposit to open a new account. Using this new credit card in a responsible manner will help to improve your good credit rating.

If you think it is hard to resist the temptation of credit, ask your creditors to lower your spending limits. However, you should do this when you are able to remain with a low balance, however. Do not lower the credit limit to the point where your current balance almost reaches the maximum.

When speaking with debt collectors, you should be honest about your current financial situation. They will be more apt to work with you and agree with you proposal if you are forthcoming with your current financial information. State clearly how much you are able to pay, and when you can pay it. Remember that they are usually open to negotiation.

From the above tips, you can see that your credit report does not need to be the cause of stress. Credit repair is possible and you do have the ability to fix your financial situation. You can greatly improve your credit record if you adhere to the tips within this article.

Wednesday, May 30, 2012

Tips to Apply for a Student Credit Card

College students are encouraged to apply for a student credit card when they feel they are already eligible. This will allow them to establish their credit promptly. However, because of the reform enacted on the Credit CARD Act of 2009, those who are under 21 years old are not qualified. They are only allowed to get a card if they either submit regular income proof or if they have someone with income as a co-signer. If you are a college student and have decided that you want to start having credit, here are a few things that you need to know:

Before You Sign

All companies present their clients with an agreement. It is your job to comprehend everything that is written in the agreement, including the interest rates and the fees. Some card companies will offer you with great deals, but for a price or with confusing programs. Make sure that all is clearly disclosed to you. This builds trust between you and your creditor. If there are items that you do not understand, do not hesitate to ask.

How Many Credit Cards Should You Have?

Since you are just starting to establish your credit history, it is a good idea to begin with just one credit card. It is understandable that you will be tempted to apply for a few more cards. However, it is better to use a single card at this point. Aside from the fact that each card application can hurt your score, having more of these plastics may lead you to debt in just a short period of time.

Using the Student Card

Paying with plastics can be fun, especially for college students. Having such a tool is often viewed as a symbol of financial prestige. Often, students do not realize that credit cards should not be used for purchases that they cannot afford. This is actually the quickest path towards debt that you will find difficult to repay. It is unwise to carry a balance since this will cause your grace period to end. The next thing you may know is that you are already knee-deep in debt without money to pay for it.

Do You Know That Your Account Has a Limit?

All credit cards have a credit limit. Students are often presented with low limit at first. This will gradually increase as you construct your history over time. If you go over your limit, you may be required to pay a fee as punishment. Creditors earn more interest as you carry a balances. As you struggle to pay for your debt, they enjoy taking more money from you.

Should You Pay an Annual Fee to Gain More Benefits?

One of the first things that you should look at before you sign up for a credit card is the annual fee. Since you are just a student, it is strongly recommended that you choose a card without an annual fee. When you use your card, the creditor already earns money as they charge a small fee to the merchant. There are other fees that you may have to pay but an annual fee should not be one of them.

Friday, May 25, 2012

3 Credit Repair Practices To Avoid

The credit repair process can be tedious and take several months depending on how much negative information exists in your credit reports. Consumers engaged in credit repair often have a purpose and goal. It may be to purchase a home, refinance a mortgage, change careers, obtain a home equity loan or even buy a new car.

The time and energy involved in repairing your credit should not be wasted by making mistakes along the way. Here are 3 credit repair practices you should avoid in order to make the process smooth and result in a better credit report and increased credit scores:

1. Use of Boilerplate or Template Form Letters

When disputing items on your credit report the best practice is to customize your dispute letters. Credit repair manuals, credit repair companies and even some credit repair websites offer form letters to dispute negative credit.

The problem with form letters is the sheer number of consumers who may be using them to repair credit. The credit bureaus receive tons of dispute letters daily. Because the credit bureaus receive an enormous amount of dispute letters; they utilize a letter recognition technology which scans each letter, whether computerized or handwritten.

As a result of the letter recognition technology, the credit bureaus have amassed a huge database of letters from consumers and discovered many of them contain the exact same information -- word for word. This includes copying and pasting letters from the Internet. Duplicate form letters are easily recognized by the credit bureaus.

Using duplicate or form letters can get your dispute letter labeled frivolous or irrelevant. Once a determination is made that a dispute is frivolous the credit bureaus can terminate the dispute process. The consumer can be barred from disputing that item for several months. The one-size-fits-all dispute letters does not work.

2. Failure to Customize Dispute Letters

Failure to customize dispute letters is related to using boilerplate or template form letters. Any credit repair letter; even if the issue is minor, should be unique, customized and based on a factual error. It's hard to argue with facts. Disputing a factual error can get your credit repair letter taken seriously.

Customized letters get the attention of the credit bureaus. In addition to automating the process of reading dispute letters; the actual dispute process has been automated by a method called e-Oscar. The e-Oscar method of investigating credit disputes converts written dispute letters into a two or three digit code.

That code is transmitted to the creditor who is the subject of the dispute and the creditor verifies the accuracy of the code. Customizing your dispute can help ensure your dispute is actually processed and investigated. You want to make it as difficult as possible for the credit bureaus to reduce your dispute letters to a code which is simply transmitted to the creditor to verify as accurate or inaccurate.

Customizing a dispute letter also gives you the opportunity to attach supporting documentation. The more detail the better. By basing your disputes on factual errors you establish a good foundation in case the credit bureaus flag your disputes as frivolous or irrelevant. You will have the basis for the credit bureaus violating the Fair Credit Reporting Act by not conducting re-investigation of disputed items as required by law.

3. Dispute every negative item at once

All errors and inaccurate information should be disputed, but not all at once. Performing a blanket dispute of all negative items can also lead to the credit bureaus flagging your disputes as frivolous or irrelevant. They may even accuse you of using a third-party credit repair company.

The best way to dispute all negative items is to dispute a few errors at a time in intervals of 30 to 60 days apart. Bombarding the credit bureaus with multiple credit disputes is a sure way to get your credit report flagged and your credit disputes ignored.