Most people use credit cards, but do they understand the charges involved?
Apparently not. The figures show that 50% of card users only pay the minimum balance every month.
A typical scenario may start with you receiving a credit card offer in the mail: borrow up to $2000 and pay only $40 a month. The interest at 18% ( could easily be higher) but the payment is still only $40 a month. Sounds like a great deal! You've been thinking of buying a new big screen TV for ages, and now you can have it all for only $40 a month. Who COULDN'T afford this, right? Before you sign that offer and run out to purchase your new TV, let's look at the mathematics and see how long it will take you to pay off this purchase at $40 per month, what you'll end up paying in interest, how long it will take to pay off the balance, and the total amount you'll end up paying for your $2000 TV.
The minimum monthly payment on most credit cards is usually calculated as a certain percentage (often around 2 percent) of your total balance. Remember, however, that this payment includes interest as well as payments against the principal amount that you borrowed. On the $2000 TV, 2 percent of the balance is $40. At 18 percent interest, your $40 payment would include $30 in interest and only $10 towards the amount you borrowed (18% divided by 360 days = 0.05% per day times 30 days in a month times $2000 outstanding balance equals £30 in interest).
If you pay the minimum balance each month (calculated as 2% of your outstanding balance), it will take you over 30 years to pay off your $2000 TV, which will be gone long before it's paid for. What's worse, you'll have paid nearly $5,000 in interest. The $2000 TV will have cost you nearly $7000!
To make matters even worse, think of what you would have earned if you had simply put $40 a month into an investment earning a conservative 8 percent for the same number of years (30). Your £40 a month would be worth over $60,000 and you would have earned almost $46,000 in interest on your investment.
Many people get caught up in credit card offers that are "too good to pass up." The question is: "good for whom?" Certainly not good for you! The example of the TV purchase illustrates the extremely high cost of paying the minimum balance on your credit cards. The Independent on Line 19 Feb 2006 confirms this with their statement:- “Separate studies reveal that a £2,000 credit card debt at an APR of 15.9, repaid at only the minimum 2 per cent, would take more than 28 years to clear!” USwitch spokesman Nick White said:- "Today, there's the possibility that some people could finish off paying their mortgage before their credit cards.” "While low, affordable minimum monthly repayments are marketed as being a benefit to cardholders, this benefit is a big money-spinner for the banks." It's a real eye-opener!
Monday, June 11, 2007
Learn The Two Things You Can Do To Increase Your Credit Scores By 65% in The Next 60-90 Days
There are two things you can do today that will have a dramatic effect on your credit scores in the days to come, do you know what they are?
Paying your debts on time (effects 35% of your score) and reducing how much you owe (effects 30% of your score).
Here is how your score is computed:
I. Payment History (35% of your score)- The number of accounts paid on time effect your credit score.- The number of negative public records and/or collections reported effect your credit score.- The number of delinquent accounts affect your credit score. - How long you have been past due affects your credit score.- How long it has been since you have made a late payment.
MORAL: Pay your bills on time
II. Amounts Owed (30% of your score)- How much you owe on each open account effects your credit score.- What types of accounts you have with balances effects your credit score.- How much of your available credit you have used affects your credit score (revolving credit).- How much you owe versus the original balance effects your credit score (installment debt). - The number of zero balance accounts you have affect your credit scores.
MORAL: Try to keep all outstanding credit debt between 30-35% of available credit to maximize your credit scores.
III. Length of History (15% of your score)- The length of time your credit accounts have been reported to your credit report effects your credit scores.- The length of time your credit accounts were opened effects your credit scores.- The time between activities affects your credit scores.
MORAL: The longer the history (good or bad), the better or worse your scores will be.
IV. New Credit (10% of your score)- The number of new credit accounts you open affects your credit scores.- The ratio of new credit accounts to existing accounts affects your credit scores.- The number of credit inquiries you have had affects your credit scores.- The time elapsed since your last inquiry or the opening of a new credit account affects your credit scores.- The length of time of your on time payments since your last late payment effects your credit scores.
MORAL: Don't open up too many new credit accounts at once.
V. Types of Credit in Use (10% of your score)- The total number of credit accounts you have affects your credit scores.- The types of credit accounts (installment, revolving) you have effects your credit scores.
Paying your debts on time (effects 35% of your score) and reducing how much you owe (effects 30% of your score).
Here is how your score is computed:
I. Payment History (35% of your score)- The number of accounts paid on time effect your credit score.- The number of negative public records and/or collections reported effect your credit score.- The number of delinquent accounts affect your credit score. - How long you have been past due affects your credit score.- How long it has been since you have made a late payment.
MORAL: Pay your bills on time
II. Amounts Owed (30% of your score)- How much you owe on each open account effects your credit score.- What types of accounts you have with balances effects your credit score.- How much of your available credit you have used affects your credit score (revolving credit).- How much you owe versus the original balance effects your credit score (installment debt). - The number of zero balance accounts you have affect your credit scores.
MORAL: Try to keep all outstanding credit debt between 30-35% of available credit to maximize your credit scores.
III. Length of History (15% of your score)- The length of time your credit accounts have been reported to your credit report effects your credit scores.- The length of time your credit accounts were opened effects your credit scores.- The time between activities affects your credit scores.
MORAL: The longer the history (good or bad), the better or worse your scores will be.
IV. New Credit (10% of your score)- The number of new credit accounts you open affects your credit scores.- The ratio of new credit accounts to existing accounts affects your credit scores.- The number of credit inquiries you have had affects your credit scores.- The time elapsed since your last inquiry or the opening of a new credit account affects your credit scores.- The length of time of your on time payments since your last late payment effects your credit scores.
MORAL: Don't open up too many new credit accounts at once.
V. Types of Credit in Use (10% of your score)- The total number of credit accounts you have affects your credit scores.- The types of credit accounts (installment, revolving) you have effects your credit scores.
Low Interest Credit Cards Are Great Financial Tools
When searching online for the best low interest rate credit cards do not make the assumption that all credit cards are created equal. The fact is unless you spend a little bit of time researching to find the best credit card deal you may not end up with as low of an interest rate as you had initially planned. Just like any other purchase it is always wise to do some comparison shopping even if it is only for a low interest rate credit card. The best card should be one that offers both a low interest rate on purchases as well as cash advances. A word of caution when comparing low interest rate credit card deals and offers. Some cards may only offer the lower interest for 6 months or for an initial balance transfer. What initially seemed like the best low interest rate credit card can suddenly turn out to be a credit card nightmare if you are sitting on a large balance at the end of that introductory time period.
Low interest rate credit cards with attractive introductory rates and low interest rate credit cards with low fixed rates can each save you money when it comes to interest expenses. All of the major credit card companies, including MasterCard, Visa, Discover, and American Express, offer low interest credit cards. Often, these companies will send mailings to your home or advertise their low interest rate credit cards on television. While advertisements and mailings provide you with a great way to learn more about your available options, you should also research other low interest credit cards.
Low interest rate credit cards are often offered to people with excellent credit ratings. Low interest credit cards can provide you with substantial savings when it comes to interest expenses. Of course, the best way to save on interest is to pay the balance of your credit card off at the end of each billing cycle. In this way, you get to borrow the money for a brief time without having to pay any interest. The 0% introductory rate many low interest credit cards give provides you with one great way to save on interest expenses, but remember you will need to pay off the balance entirely when the introductory period is over in order to get the optimum savings on interest expenses. If this is not a possibility for you, then be sure to select low interest credit cards that remain low interest after the introductory period is over.
Low interest rate credit cards are the ones that are always advertised in the media, be it on the Internet, at credit card websites, in magazines, et cetera and there are many banks and credit card companies offering low interest credit cards; some companies offer attractive interest rates of between 5% and 9%. What these companies do not tell consumers is that only a small percentage of those who apply for a low interest credit card will actually be approved. You might be approved for a credit card if you apply, but it will probably be at a substantially higher interest rate unless you are one of the privileged few who have a high credit rating and high income.
There are many reasons why these low interest credit cards work so well, but there are also some things to look out for when choosing a low interest rate credit card. For instance, some credit cards might offer a low interest rate but require you pay an annual fee of $50 or $60. When the expense of the annual fee is factored in, the effective interest rate is higher than the actual rate stated.
As you can see, a low interest rate credit card can be very helpful, but only if it truly meets your financial needs, based on your spending and paying patterns. You should also know many consumers consider low interest rate credit cards are truly the best credit cards to hold. To determine if you are interested in a low interest credit card, visit a credit card website, and make credit card comparisons, then decide if the low interest credit card is the best credit card for your financial portfolio.
Low interest rate credit cards with attractive introductory rates and low interest rate credit cards with low fixed rates can each save you money when it comes to interest expenses. All of the major credit card companies, including MasterCard, Visa, Discover, and American Express, offer low interest credit cards. Often, these companies will send mailings to your home or advertise their low interest rate credit cards on television. While advertisements and mailings provide you with a great way to learn more about your available options, you should also research other low interest credit cards.
Low interest rate credit cards are often offered to people with excellent credit ratings. Low interest credit cards can provide you with substantial savings when it comes to interest expenses. Of course, the best way to save on interest is to pay the balance of your credit card off at the end of each billing cycle. In this way, you get to borrow the money for a brief time without having to pay any interest. The 0% introductory rate many low interest credit cards give provides you with one great way to save on interest expenses, but remember you will need to pay off the balance entirely when the introductory period is over in order to get the optimum savings on interest expenses. If this is not a possibility for you, then be sure to select low interest credit cards that remain low interest after the introductory period is over.
Low interest rate credit cards are the ones that are always advertised in the media, be it on the Internet, at credit card websites, in magazines, et cetera and there are many banks and credit card companies offering low interest credit cards; some companies offer attractive interest rates of between 5% and 9%. What these companies do not tell consumers is that only a small percentage of those who apply for a low interest credit card will actually be approved. You might be approved for a credit card if you apply, but it will probably be at a substantially higher interest rate unless you are one of the privileged few who have a high credit rating and high income.
There are many reasons why these low interest credit cards work so well, but there are also some things to look out for when choosing a low interest rate credit card. For instance, some credit cards might offer a low interest rate but require you pay an annual fee of $50 or $60. When the expense of the annual fee is factored in, the effective interest rate is higher than the actual rate stated.
As you can see, a low interest rate credit card can be very helpful, but only if it truly meets your financial needs, based on your spending and paying patterns. You should also know many consumers consider low interest rate credit cards are truly the best credit cards to hold. To determine if you are interested in a low interest credit card, visit a credit card website, and make credit card comparisons, then decide if the low interest credit card is the best credit card for your financial portfolio.
Benefits Of Using A Credit Card Debt Consolidation Agency To Manage Multiple Credit Card Debts
Having multiple credit cards brings more problems than benefits to a person's life. Keeping track of multiple repayments, varying interest rates can be too overwhelming and if not managed properly can lead to late payment penalties. Procrastination on repaying the debts can lead to accumulations of high interest credit card balances, that threaten to throw a person into credit card debt and under serious default it can lead to bankruptcies. Credit card debt consolidation helps such people, but an individual is not qualified and experienced to get the best consolidation deal. Here's when the credit card debt consolidation agencies come into the picture. They can do a lot for such debt ridden people. In this article we take a look at what benefits a credit card debt consolidation company can bring to a person who is suffering due to multiple credit card debts.
1. Single not multiple debt
Credit card debt consolidation gets rid of multiple credit card debts instantly. This brings a welcome relief to the debtor who is plagued by multiple credit card repayment dates, juggling of APRs and various penalties.
2. End of harassment
Credit card debt consolidation brings an end to the threatening calls from debt recovery agencies. All the communication is now channeled via the debt consolidation agency, which takes care of all the harassment in a more professional manner and restores peace back in your life.
3. Professional negotiations on your behalf
Credit card debt settlement agencies, have seasoned professionals with extensive experience in negotiating debts with credit card companies. This ensures that your point is put correctly before the credit card companies and a well negotiated settlement is reached.
4. Reduction in overall burden
Credit card debt settlement companies not only club all your existing debts into a single debt, but they also do it so that you are able to pay it more easily and it reduces the debt burden significantly. This involves waving of late payment fees, reducing interest, making the loan a long term loan and reducing monthly repayment amounts.
5. Saves from bankruptcy and prevents severe damage to credit report
By taking a credit card debt consolidation, you get one more chance to repay your debts. Following the debt repayment schedule diligently will keep you out of the debt trap and ensure that the damaging effects of getting bankrupt do not arrive and malign your credit report.
1. Single not multiple debt
Credit card debt consolidation gets rid of multiple credit card debts instantly. This brings a welcome relief to the debtor who is plagued by multiple credit card repayment dates, juggling of APRs and various penalties.
2. End of harassment
Credit card debt consolidation brings an end to the threatening calls from debt recovery agencies. All the communication is now channeled via the debt consolidation agency, which takes care of all the harassment in a more professional manner and restores peace back in your life.
3. Professional negotiations on your behalf
Credit card debt settlement agencies, have seasoned professionals with extensive experience in negotiating debts with credit card companies. This ensures that your point is put correctly before the credit card companies and a well negotiated settlement is reached.
4. Reduction in overall burden
Credit card debt settlement companies not only club all your existing debts into a single debt, but they also do it so that you are able to pay it more easily and it reduces the debt burden significantly. This involves waving of late payment fees, reducing interest, making the loan a long term loan and reducing monthly repayment amounts.
5. Saves from bankruptcy and prevents severe damage to credit report
By taking a credit card debt consolidation, you get one more chance to repay your debts. Following the debt repayment schedule diligently will keep you out of the debt trap and ensure that the damaging effects of getting bankrupt do not arrive and malign your credit report.
The True Colors of American Express Blue Card
Used primarily as a charge card back in 1958, American Express has definitely grown into a more efficient financial institution that renders more services to their clients, serving millions of customers worldwide.
From more than a million of credit cards that were issued since it first started its charge card in 1958, American Express today is growing each year with additional customers gaining notable satisfaction form its services. Dedicated to promote financial support to its clients, American Express has launched its series of blue credit cards to give way to those who wish to those who wish exceptional financial services and complimentary rewards program.
Reflecting the stable growth of the company, American Express blue cards created such a phenomenal hit that the company decided to offer four special blue cards for various choices. The unique benefit of American Express blue cards is that each type of card has its own remarkable advantage.
1. The Original American Express Blue Card
On top of the list of blue cards from American Express, the original American Express blue card is still the base line of all American Express blue cards. Although the new types of blue cards are considered more power-packed and may offer greater benefits, the original American Express blue card is still a good choice.
One of the greatest benefits you can enjoy with this blue card is its 0% APR or annual percentage rate. This means that you get lower calculated interest rates established on the main amount borrowed by an individual. This serves as the main baseline for the initial interest rate charges whenever the credit cardholder makes some transactions such as balance transfers, incurred balances, and cash advances.
On top of the other benefits, you can also enjoy tremendous rewards based on earned points. Best of all, American Express blue card does not have an annual fee.
2. Blue cash
Cash back rewards are always welcome scene for anybody who wishes to save more on their purchases. With Blue cash card from American Express, you can definitely enjoy higher percentages on cash backs. For instance, if other cards are giving you 2% cash back on your purchases, you can get as much as 5% cash back with American Express blue cash card. So you get 5% cash back on your bills, gas, etc.
3. Jet blue
Named after the Jet Blue Airways, the American Express Jet Blue cards are the perfect cards for people who travel a lot. With a jet blue card, you can easily accumulate points and use them to get free flights from Jet Blue Airways.
4. Sky blue
As clear as the sky, American Express Sky Blue card can give you clear rewards as stated in your fine print or some American Express brochures. The problem with most credit cards is that they offer false hopes to people who tried to earned or accumulate such points only to find out that the promised place did not turn out the way it was suppose to be.
The good thing about sky blue card is that it can even provide you places that the other credit cards have not offered before. Best of all, sky blue cards offer no restrictions. Hence, travelers can enjoy the destination place of their choice. You can also enjoy other privileges that only American Express blue card can give.
Indeed, colors may not say it all but with American Express blue cards hanging around in almost anybody’s pocket, the credit card industry has definitely a long way to go because people will continue to enjoy cashless shopping.
From more than a million of credit cards that were issued since it first started its charge card in 1958, American Express today is growing each year with additional customers gaining notable satisfaction form its services. Dedicated to promote financial support to its clients, American Express has launched its series of blue credit cards to give way to those who wish to those who wish exceptional financial services and complimentary rewards program.
Reflecting the stable growth of the company, American Express blue cards created such a phenomenal hit that the company decided to offer four special blue cards for various choices. The unique benefit of American Express blue cards is that each type of card has its own remarkable advantage.
1. The Original American Express Blue Card
On top of the list of blue cards from American Express, the original American Express blue card is still the base line of all American Express blue cards. Although the new types of blue cards are considered more power-packed and may offer greater benefits, the original American Express blue card is still a good choice.
One of the greatest benefits you can enjoy with this blue card is its 0% APR or annual percentage rate. This means that you get lower calculated interest rates established on the main amount borrowed by an individual. This serves as the main baseline for the initial interest rate charges whenever the credit cardholder makes some transactions such as balance transfers, incurred balances, and cash advances.
On top of the other benefits, you can also enjoy tremendous rewards based on earned points. Best of all, American Express blue card does not have an annual fee.
2. Blue cash
Cash back rewards are always welcome scene for anybody who wishes to save more on their purchases. With Blue cash card from American Express, you can definitely enjoy higher percentages on cash backs. For instance, if other cards are giving you 2% cash back on your purchases, you can get as much as 5% cash back with American Express blue cash card. So you get 5% cash back on your bills, gas, etc.
3. Jet blue
Named after the Jet Blue Airways, the American Express Jet Blue cards are the perfect cards for people who travel a lot. With a jet blue card, you can easily accumulate points and use them to get free flights from Jet Blue Airways.
4. Sky blue
As clear as the sky, American Express Sky Blue card can give you clear rewards as stated in your fine print or some American Express brochures. The problem with most credit cards is that they offer false hopes to people who tried to earned or accumulate such points only to find out that the promised place did not turn out the way it was suppose to be.
The good thing about sky blue card is that it can even provide you places that the other credit cards have not offered before. Best of all, sky blue cards offer no restrictions. Hence, travelers can enjoy the destination place of their choice. You can also enjoy other privileges that only American Express blue card can give.
Indeed, colors may not say it all but with American Express blue cards hanging around in almost anybody’s pocket, the credit card industry has definitely a long way to go because people will continue to enjoy cashless shopping.
Tips For Responsible Credit Card Use When You Have Bad Credit
If your current credit situation is not as good as it could be you need to be very responsible when using credit cards. While irresponsible spending habits are not always the cause of bad credit no matter how you ended up in this situation the privilege of credit card use should be taken seriously to prevent going into further debt.
Here are some great tips for responsible credit card use.
If you have several credit cards look into transferring the balances to one or two that have the lowest interest rates and then get rid of the other credit cards. By limiting the number of credit cards that you own you will not have to worry about juggling a repayment schedule that you can’t afford to keep up with. Once you have the balances on your remaining credit card under control then try to limit your purchases to things that you really need.
Refrain from taking out cash advances on your credit card if at all possible. Credit cards most always charge huge interest rates on cash advances so if this is a common practice for you it will certainly drive you further into debt and if you already have bad credit it will only make things worse. If you do need to take out a cash advance on your credit card make sure you will be able to repay it as soon as possible.
Repay you credit card bills on time. This is simple common knowledge but is often overlooked by many credit card users. Document your payment schedule and follow it to the letter. This will not only help you build a solid history of good credit it will save you the stress of worrying about getting your credit card bill paid.
Developing responsible spending habits with your credits cards when you have bad credit will help you regain good credit standing and will help you from going further into debt.
Here are some great tips for responsible credit card use.
If you have several credit cards look into transferring the balances to one or two that have the lowest interest rates and then get rid of the other credit cards. By limiting the number of credit cards that you own you will not have to worry about juggling a repayment schedule that you can’t afford to keep up with. Once you have the balances on your remaining credit card under control then try to limit your purchases to things that you really need.
Refrain from taking out cash advances on your credit card if at all possible. Credit cards most always charge huge interest rates on cash advances so if this is a common practice for you it will certainly drive you further into debt and if you already have bad credit it will only make things worse. If you do need to take out a cash advance on your credit card make sure you will be able to repay it as soon as possible.
Repay you credit card bills on time. This is simple common knowledge but is often overlooked by many credit card users. Document your payment schedule and follow it to the letter. This will not only help you build a solid history of good credit it will save you the stress of worrying about getting your credit card bill paid.
Developing responsible spending habits with your credits cards when you have bad credit will help you regain good credit standing and will help you from going further into debt.
Knowing Your Predatory Credit Card Companies
For a number of credit card consumers, lending options are widely available. However for individuals with bad credit, the options are few and far between. With this in mind, lenders may take advantage of individuals who have problems repaying debt. These organizations typically target people with tarnished credit, elderly, or low-income individuals. Predatory lending for credit cards companies are becoming rampant thanks to the ease of targeting certain demographics and markets.
Predatory lending is a practice that provides unreasonable rates and fees for bad credit consumers. They offer high interest rates and, often, high fees for each credit that they sell to the borrower. By doing so, the repayment amount becomes too steep - or fees become unusually high for the average cardholder.
For people with tarnished credit scores, careful consideration should be taken for “bargain loans”. Bargain loans are programs that promise that an individual’s tarnished credit isn’t a problem. The offers are often labeled as a “limited time” offer and consumers are enticed to quickly apply. In many instances, the lenders offer instant approval or even guaranteed approval for their card application.
Interestingly, it’s illegal for lenders to require payment of fees before a loan is actualized. If this happens, the borrower should immediately report this to the proper agencies. There are plenty of scam operations that charge a huge fee and then not offer the loan to the applicant.
Before applying for such a loan, the applicant should check to see the terms of the credit card before signing the dotting line. One should verify that the terms of agreement is the same as what was discussed with a sale representative.
Individuals with bad credit should try to determine if the lender is a trustworthy company. One can simply ask for references from the lender, or contact the Better Business Bureau for any complaints. Sometimes information about the lender can be found by a simple search in a search engine like Google. News or complaints by customers on popular websites such as ripoff.com can raise red flags. There are even forums for credit cards that have opinions and complaints from cardholders.
Card applicants should shop around as well. The consumer should look at the rates and fees for each credit card and assess which one is right. Sometimes customer service is an important factor. Ask for the customer service hours and service quality.
Credit cards can also come in the form of a secured card. In other words, you would need to provide collateral such as cash to get the credit card. For example, a $300 credit card limit will require you to upfront $300. However, if the credit card company requires that the collateral amount should be over the card limit, then it may be best to walk away from the program.
Predatory lenders also take advantage of the grace period. In fact, the lending company could issue the bill with a payment due date of the mail issue date. This means that by the time the recipient receives the bill, the bill will be already past due. The lender now has means to raise the rates and fees.
Consumers need to be aware of Credit Card companies that are involved in predatory practices, especially consumers with bad credit. As more of these practices become apparent, consumers now have the means to arm themselves from such lenders.
Predatory lending is a practice that provides unreasonable rates and fees for bad credit consumers. They offer high interest rates and, often, high fees for each credit that they sell to the borrower. By doing so, the repayment amount becomes too steep - or fees become unusually high for the average cardholder.
For people with tarnished credit scores, careful consideration should be taken for “bargain loans”. Bargain loans are programs that promise that an individual’s tarnished credit isn’t a problem. The offers are often labeled as a “limited time” offer and consumers are enticed to quickly apply. In many instances, the lenders offer instant approval or even guaranteed approval for their card application.
Interestingly, it’s illegal for lenders to require payment of fees before a loan is actualized. If this happens, the borrower should immediately report this to the proper agencies. There are plenty of scam operations that charge a huge fee and then not offer the loan to the applicant.
Before applying for such a loan, the applicant should check to see the terms of the credit card before signing the dotting line. One should verify that the terms of agreement is the same as what was discussed with a sale representative.
Individuals with bad credit should try to determine if the lender is a trustworthy company. One can simply ask for references from the lender, or contact the Better Business Bureau for any complaints. Sometimes information about the lender can be found by a simple search in a search engine like Google. News or complaints by customers on popular websites such as ripoff.com can raise red flags. There are even forums for credit cards that have opinions and complaints from cardholders.
Card applicants should shop around as well. The consumer should look at the rates and fees for each credit card and assess which one is right. Sometimes customer service is an important factor. Ask for the customer service hours and service quality.
Credit cards can also come in the form of a secured card. In other words, you would need to provide collateral such as cash to get the credit card. For example, a $300 credit card limit will require you to upfront $300. However, if the credit card company requires that the collateral amount should be over the card limit, then it may be best to walk away from the program.
Predatory lenders also take advantage of the grace period. In fact, the lending company could issue the bill with a payment due date of the mail issue date. This means that by the time the recipient receives the bill, the bill will be already past due. The lender now has means to raise the rates and fees.
Consumers need to be aware of Credit Card companies that are involved in predatory practices, especially consumers with bad credit. As more of these practices become apparent, consumers now have the means to arm themselves from such lenders.
7 Tips to Get a Credit Card if You Have Bad Credit
Yes You Can Get a Credit Card Even if You Have Bad Credit.
In these modern times, owning a credit card is truly a necessity. The advantage and convenience on paying bills and purchase transactions using the plastic cards is needed for today's busy people.
Furthermore, people are not always having sufficient funds to make acquisitions, whether significant or non-significant. Most retailers are also offering perks, discounts and attractive packages for credit card transactions.
Some people are not comfortable keeping cash on their purses. For security purposes, most people, from all works of life, are charging bills and purchases on their credit cards.
But getting a credit card is not as easy as using them on transactions. Although there are numerous banks and financial institutions, securing a credit card account is truly difficult because there are many considerations.
Credit history is among the most crucial factor that determines your capability to secure a credit card account. This is the particular aspect of consumers' finance standing that make getting that plastic card a really tough task.
If you are among those people who have poor credit history, or more known in the lending lingo as bad credit, you are surely headed for a tough time in getting a credit card.
Why? It is because most credit card issuers are preferring to give out credit cards only to those who are less risky and are proven to handle or repay any debts that may accumulate from credit card transactions.
The surge in volume of credit card users in the past years is now starting to pay off. Many credit card firms have been encountering difficulties collecting payments from people who have spent more on their credit card transactions than what they can actually pay for.
Even regulators are enforcing safeguards that would disallow credit card issuers from easily providing credit facilities to customers. The idea is to make sure the past mistakes on credit card approvals will not be repeated.
Guidelines for credit card applications for people with bad credit
But if you are really desperate to get a credit card despite your bad credit standing, you should not lose hope. As they say, if there is a will, there is definitely a way.
Before embarking on the initiative to get credit card, you should first ask yourself whether you really need one, or whether you will be able to handle it properly.
Your paying capacity should also be noted, because you surely would not want to get yourself under huge pile of debts from future credit card charges and transactions.
Here are seven simple tips that would help you get a credit card, especially if you are among those people who are categorized as having bad credit records.
1. There are credit card facilities currently available in the market especially structured for people like you. Bad credit cards are scattered all over the place and many banks and financial institutions are starting to offer them.
Bad credit cards are different from the regular credit cards in that these cards are designed and made especially for people with bad credit standing. The terms and conditions are much flexible, though the credit limit is also substantially lower.
However, you need to open one to establish your credit history. If you have successfully opened a bad credit card account, make sure to pay on time and control your spending, so you could tarnish your records. After some time, your standing will elevate into good credit, and so you would be able to get regular credit card facilities.
2. For a start, you could also open credit card accounts at minor retail stores. Retailers are often more than willing to provide you the lean chance to own a credit card so you could make purchases at their stores.
3. If you are applying for a regular credit card, you must first find a friend or relative who will be willing to sign in as your co-guarantor. That means, if you fail to pay bills in the future, the co-guarantor will allow the credit card issuer to charge your dues to him or to her.
4. If you can help it, try getting credit cards from any issuer or bank but not from a single store or retail chain. If you are aiming to use the card on purchases from a retailer, it is advisable to get a credit card from that retail chain. Otherwise, secure an account from other institutions who are giving more flexible and better terms.
5. Avoid getting credit cards that require annual fees. There are many other credit card issuers that do not collect yearly charges on memberships. You should get a waived-annual-fee credit card as much as possible especially if your budget is strained.
6. If the above mentioned measures fail, then resort to getting a secured credit card facility. Secured credit cards will require you to have or open an existing savings account in a bank that would serve as a security for your credit line. The credit limit that would be implemented in your credit card account will equate to a percentage of your total deposits in your savings account.
7. Finally, to open a credit card when you have bad credit history, you simply have to uphold your rights. If a credit card company denies you an account, demand a written statement why your application was turned down. Ask for a copy of your credit standing so you would have a reference and determine how you could improve your records.
Some people will surely advise you not to get a credit card instead. If you have enough money to spend, then just stick to your paying power.
But if you really need one, then go for it. Just make sure you have the intention to pay your bills on time so you would not have problems in the future.
In these modern times, owning a credit card is truly a necessity. The advantage and convenience on paying bills and purchase transactions using the plastic cards is needed for today's busy people.
Furthermore, people are not always having sufficient funds to make acquisitions, whether significant or non-significant. Most retailers are also offering perks, discounts and attractive packages for credit card transactions.
Some people are not comfortable keeping cash on their purses. For security purposes, most people, from all works of life, are charging bills and purchases on their credit cards.
But getting a credit card is not as easy as using them on transactions. Although there are numerous banks and financial institutions, securing a credit card account is truly difficult because there are many considerations.
Credit history is among the most crucial factor that determines your capability to secure a credit card account. This is the particular aspect of consumers' finance standing that make getting that plastic card a really tough task.
If you are among those people who have poor credit history, or more known in the lending lingo as bad credit, you are surely headed for a tough time in getting a credit card.
Why? It is because most credit card issuers are preferring to give out credit cards only to those who are less risky and are proven to handle or repay any debts that may accumulate from credit card transactions.
The surge in volume of credit card users in the past years is now starting to pay off. Many credit card firms have been encountering difficulties collecting payments from people who have spent more on their credit card transactions than what they can actually pay for.
Even regulators are enforcing safeguards that would disallow credit card issuers from easily providing credit facilities to customers. The idea is to make sure the past mistakes on credit card approvals will not be repeated.
Guidelines for credit card applications for people with bad credit
But if you are really desperate to get a credit card despite your bad credit standing, you should not lose hope. As they say, if there is a will, there is definitely a way.
Before embarking on the initiative to get credit card, you should first ask yourself whether you really need one, or whether you will be able to handle it properly.
Your paying capacity should also be noted, because you surely would not want to get yourself under huge pile of debts from future credit card charges and transactions.
Here are seven simple tips that would help you get a credit card, especially if you are among those people who are categorized as having bad credit records.
1. There are credit card facilities currently available in the market especially structured for people like you. Bad credit cards are scattered all over the place and many banks and financial institutions are starting to offer them.
Bad credit cards are different from the regular credit cards in that these cards are designed and made especially for people with bad credit standing. The terms and conditions are much flexible, though the credit limit is also substantially lower.
However, you need to open one to establish your credit history. If you have successfully opened a bad credit card account, make sure to pay on time and control your spending, so you could tarnish your records. After some time, your standing will elevate into good credit, and so you would be able to get regular credit card facilities.
2. For a start, you could also open credit card accounts at minor retail stores. Retailers are often more than willing to provide you the lean chance to own a credit card so you could make purchases at their stores.
3. If you are applying for a regular credit card, you must first find a friend or relative who will be willing to sign in as your co-guarantor. That means, if you fail to pay bills in the future, the co-guarantor will allow the credit card issuer to charge your dues to him or to her.
4. If you can help it, try getting credit cards from any issuer or bank but not from a single store or retail chain. If you are aiming to use the card on purchases from a retailer, it is advisable to get a credit card from that retail chain. Otherwise, secure an account from other institutions who are giving more flexible and better terms.
5. Avoid getting credit cards that require annual fees. There are many other credit card issuers that do not collect yearly charges on memberships. You should get a waived-annual-fee credit card as much as possible especially if your budget is strained.
6. If the above mentioned measures fail, then resort to getting a secured credit card facility. Secured credit cards will require you to have or open an existing savings account in a bank that would serve as a security for your credit line. The credit limit that would be implemented in your credit card account will equate to a percentage of your total deposits in your savings account.
7. Finally, to open a credit card when you have bad credit history, you simply have to uphold your rights. If a credit card company denies you an account, demand a written statement why your application was turned down. Ask for a copy of your credit standing so you would have a reference and determine how you could improve your records.
Some people will surely advise you not to get a credit card instead. If you have enough money to spend, then just stick to your paying power.
But if you really need one, then go for it. Just make sure you have the intention to pay your bills on time so you would not have problems in the future.
How To Go About Managing Debt
If you are thinking about purchasing something on credit or taking a loan, you may find this article of interest.
About Debt
Sometimes there’s just no way around it, you have to borrow money. This is often the case when buying a home or paying for education, and we must accept that this is not always a bad thing.
Buying a home and getting a tertiary education are two examples of using credit to pay for investments that may benefit us in the long run – hopefully! Property has always been one of the best investment options and the return on your investment over a few years should yield a profit, and a good education should increase your earning ability and set you up for a more successful life. How you go about managing the debt is what counts in the end though.
A business acquisition can also be a safe bet for going into debt, as long as the promise of return will be profitable. In general terms you can weigh up the decision of whether to purchase on credit or not by estimating the long term return on your investment. A student loan, mortgage or loan for buying a business may well turn out to be good decisions which set you up to create greater wealth. Managing debt begins with knowing when to buy on credit.
Problems arise when purchases are made on credit for things which depreciate in value. The most common of these purchase types is cars, but sometimes this is unavoidable. Try really hard not to pay for items such as furniture, televisions, sound systems or computers with credit. Purchasing excessively on your credit card can be a sign of mismanaging your debt. If you need to resort to buying on credit the most important thing to remember is to keep track of your debt!
Plan your repayments and make sure that you are able to stay above water. Keeping a close eye on your credit will help in managing debt.
About Debt
Sometimes there’s just no way around it, you have to borrow money. This is often the case when buying a home or paying for education, and we must accept that this is not always a bad thing.
Buying a home and getting a tertiary education are two examples of using credit to pay for investments that may benefit us in the long run – hopefully! Property has always been one of the best investment options and the return on your investment over a few years should yield a profit, and a good education should increase your earning ability and set you up for a more successful life. How you go about managing the debt is what counts in the end though.
A business acquisition can also be a safe bet for going into debt, as long as the promise of return will be profitable. In general terms you can weigh up the decision of whether to purchase on credit or not by estimating the long term return on your investment. A student loan, mortgage or loan for buying a business may well turn out to be good decisions which set you up to create greater wealth. Managing debt begins with knowing when to buy on credit.
Problems arise when purchases are made on credit for things which depreciate in value. The most common of these purchase types is cars, but sometimes this is unavoidable. Try really hard not to pay for items such as furniture, televisions, sound systems or computers with credit. Purchasing excessively on your credit card can be a sign of mismanaging your debt. If you need to resort to buying on credit the most important thing to remember is to keep track of your debt!
Plan your repayments and make sure that you are able to stay above water. Keeping a close eye on your credit will help in managing debt.
How to Get a Business Credit Card
4 Steps to Getting the Best Business Credit Cards
A business credit card offers you a convenient way to pay for goods and services for your business. It returns the pleasure of managing a company that is your very own.
The very minute you have secured a business credit card account that is for your company, you will be assisted in each area of your business. These cards can help you respond faster to opportunities that arise. It is like having instant approval on a small business loan, ready to go when you need it.
1.) When you are applying for business credit cards, the first and foremost rule is that you cannot be discriminated on issues of race, religion, color, national origin, marital status or age – even with your company’s customers.
Let us say that you are applying for a loan in order to open a store. The lender does not have the right to reject this application simply because of the race of your targeted market.
Given the situation that your application for a business credit card has been rejected, there is a way to find out the reason why. Submit a written request inquiring upon the matter. This must be sent 60 days within the date the loan was denied. The lender, on his part, must state the reasons – also written – within a month (30 days) of the date of your request. If you find yourself not agreeing with the reasons, you have the right to discuss this with your lender. Who knows? You might even be able to correct any misunderstanding.
2.) Granted that you have a small business (a company that has below $1 million when it comes to gross revenues), the credit card service provider must have records of your application to a credit loan for a year after informing you of his decision. If your business eventually returns more than a million, the lender must file the records for two months (60 days) after rejecting your application.
If you request that the records be filed longer, you can do so through a written request stating the reasons for the rejection. If you do not ask this for the next 60 days, the lender may disregard your records.
3.) Let the card work for you. Make sure that the business credit card you sign up for offers benefits to your company. It would be best if it did not have a pre-set spending limit. That way you can have the flexibility to buy what your company needs. It should also provide you with an interest-free credit on your purchases with your card, as long as you pay your due on time and full every month.
Your business credit card must also protect you. It must have no liability clauses when it comes to fraudulent usage given the situation that they are stolen or lost. You have to notify your credit card service provider as soon as this occurs and as soon as it has been located.
4.) Lower the financial burdens of your staff with the business credit card account of your company. By minimizing the checks your company raises and the petty cash, you can also replace other expenses. Business credit cards are tools that can assist in minimizing the additional expenses, therefore benefiting everyone in your company.
As the manager of your business, help your staff make the most out of this opportunity by taking charge of their time. With business credit cards, the staff spends less time in completing the expense forms. Instead, they can concentrate on other critical activities of the company.
Every business owner should consider signing up for business credit cards. Think of your accounts as employees that can help you 7 days a week, 24 hours a days, 365 days a year.
A business credit card offers you a convenient way to pay for goods and services for your business. It returns the pleasure of managing a company that is your very own.
The very minute you have secured a business credit card account that is for your company, you will be assisted in each area of your business. These cards can help you respond faster to opportunities that arise. It is like having instant approval on a small business loan, ready to go when you need it.
1.) When you are applying for business credit cards, the first and foremost rule is that you cannot be discriminated on issues of race, religion, color, national origin, marital status or age – even with your company’s customers.
Let us say that you are applying for a loan in order to open a store. The lender does not have the right to reject this application simply because of the race of your targeted market.
Given the situation that your application for a business credit card has been rejected, there is a way to find out the reason why. Submit a written request inquiring upon the matter. This must be sent 60 days within the date the loan was denied. The lender, on his part, must state the reasons – also written – within a month (30 days) of the date of your request. If you find yourself not agreeing with the reasons, you have the right to discuss this with your lender. Who knows? You might even be able to correct any misunderstanding.
2.) Granted that you have a small business (a company that has below $1 million when it comes to gross revenues), the credit card service provider must have records of your application to a credit loan for a year after informing you of his decision. If your business eventually returns more than a million, the lender must file the records for two months (60 days) after rejecting your application.
If you request that the records be filed longer, you can do so through a written request stating the reasons for the rejection. If you do not ask this for the next 60 days, the lender may disregard your records.
3.) Let the card work for you. Make sure that the business credit card you sign up for offers benefits to your company. It would be best if it did not have a pre-set spending limit. That way you can have the flexibility to buy what your company needs. It should also provide you with an interest-free credit on your purchases with your card, as long as you pay your due on time and full every month.
Your business credit card must also protect you. It must have no liability clauses when it comes to fraudulent usage given the situation that they are stolen or lost. You have to notify your credit card service provider as soon as this occurs and as soon as it has been located.
4.) Lower the financial burdens of your staff with the business credit card account of your company. By minimizing the checks your company raises and the petty cash, you can also replace other expenses. Business credit cards are tools that can assist in minimizing the additional expenses, therefore benefiting everyone in your company.
As the manager of your business, help your staff make the most out of this opportunity by taking charge of their time. With business credit cards, the staff spends less time in completing the expense forms. Instead, they can concentrate on other critical activities of the company.
Every business owner should consider signing up for business credit cards. Think of your accounts as employees that can help you 7 days a week, 24 hours a days, 365 days a year.
Credit Card for People with Bad Credit in the United States
Normally if you have a bad credit, it is quite difficult to get approval for a credit card. However, you can procure a credit card for people with bad credit in the United States. These credit cards are the unsecured credit cards, especially designed to help people like you, who have bad credit. With a record of bad credit history, you may not be able to secure an average credit card. An unsecured credit card would usually offer you a lower credit limit, and a higher rate of interest, but with a really bad credit history, you may still be unable to procure one.
Unsecured Credit Cards for Bad Credit People
Many companies can help you out of your desperate situation by offering you unsecured credit card for bad credit people in the United States. They take out ads guaranteeing to approve your application for a credit card, even if you have a very bad credit. This is all fine, but you may save yourself a whole lot of grief by first reading between the lines, and going for the company that offers the best terms.
Do not accept the first offer that comes your way, just because you are desperate. This could land you in a bigger soup than you were in, to begin with. Check with a few companies offering you unsecured credit cards for bad credit. Go through their fees and charges, and other terms of agreement. Ensure that you do not land up paying more than you thought you would. Check out the kind of fees they charge. Reputed companies offering unsecured credit cards would probably charge an annual fee, and little else.
Check out the track record of the companies offering you unsecured credit cards with bad credit.
Unsecured Credit Card – A Sound Option
After sifting through all the confusion that the ads from the credit card companies create, obtaining an unsecured credit card with bad credit may be quite a sound option. Terms, such as, ‘non-prepaid credit cards for bad credit,’ and ‘guaranteed credit card approval’ are just promotional strategies, and you need to look beyond the hype.
Some companies may offer you unsecured credit card with bad credit in United States that come with a higher credit limit, but it may be a ‘shopping’ card – which you can use to purchase from a particular vendor, or a catalogue, only. It does not matter as long as you are able to shop for your needs, and that too with a higher credit.
Unsecured Credit Cards for Bad Credit People
Many companies can help you out of your desperate situation by offering you unsecured credit card for bad credit people in the United States. They take out ads guaranteeing to approve your application for a credit card, even if you have a very bad credit. This is all fine, but you may save yourself a whole lot of grief by first reading between the lines, and going for the company that offers the best terms.
Do not accept the first offer that comes your way, just because you are desperate. This could land you in a bigger soup than you were in, to begin with. Check with a few companies offering you unsecured credit cards for bad credit. Go through their fees and charges, and other terms of agreement. Ensure that you do not land up paying more than you thought you would. Check out the kind of fees they charge. Reputed companies offering unsecured credit cards would probably charge an annual fee, and little else.
Check out the track record of the companies offering you unsecured credit cards with bad credit.
Unsecured Credit Card – A Sound Option
After sifting through all the confusion that the ads from the credit card companies create, obtaining an unsecured credit card with bad credit may be quite a sound option. Terms, such as, ‘non-prepaid credit cards for bad credit,’ and ‘guaranteed credit card approval’ are just promotional strategies, and you need to look beyond the hype.
Some companies may offer you unsecured credit card with bad credit in United States that come with a higher credit limit, but it may be a ‘shopping’ card – which you can use to purchase from a particular vendor, or a catalogue, only. It does not matter as long as you are able to shop for your needs, and that too with a higher credit.
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